Thursday, 12 September 2013

Thinking like an economist ... about grocery stores

In a recent blog post, my Friedman School colleague Will Masters considers the differences in the economic incentives that manufacturers, restaurants, and supermarkets face when it comes to selling healthier food:
Today’s New York Times has a terrific news story about this frontier of research by their reporter Michael Moss. Moss just released a lively new book about how food manufacturers raise the levels of salt, sugar, fat and other ingredients in processed foods far beyond what you’d add in your own kitchen, while research at Tufts and elsewhere has shown similar problems in restaurant food. In contrast, grocery stores sell a lot of fruits, vegetables and other relatively healthy stuff, generally around the perimeter of the store. So, in the choice between processed foods, restaurant foods, and plain old groceries, what determines how consumers’ spend their hard-earned money?
Part of the answer is advertising.  I imagine other key factors are consumer tastes, demand for convenience, prices, and overall health orientation. The comments to Will's post are interesting.

Will, incidentally, this year won the prestigious Bruce Gardner Memorial Prize for Applied Policy Analysis from the Agricultural and Applied Economics Association (AAEA).

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