Willful Ignorance

“Wilful ignorance is a documented human behaviour whereby people deliberately avoid information. Although much work has documented consumer attitudes toward farm animal welfare, few studies have questioned whether people even want to know how farm animals are raised. Using an internet survey of 1,000 subjects from the US state of Oklahoma, it is shown that around one-third admit to being wilfully ignorant regarding pork production. One-third also chose to look at a blank screen rather than a picture of how pregnant hogs are housed. Avoidance of guilt is shown to be a motivator for this behaviour.”

That's the abstract of a paper by Eryn Bell, Bailey Norwood, and me that was just published in the journal Animal Welfare.

Cage free eggs: Too many or too few?

Depending on what you read, we either have way too many or way too few cage free eggs at the moment.  Here's from a USDA report on September 29, 2017 suggesting current pledges to go cage free are far outstripping the production of cage free eggs, resulting in a "shortage":

“it would take 227 million hens by 2026 to satisfy the combined demand from all restaurants, food distributors, hospitality & travel firms, grocery retailers, food manufacturers, and convenience stores that have committed to cage-free, to date. . . . Using USDA’s figures from above, the 29 million hens currently in non-organic cage-free production could indicate a shortage of 198 million hens to meet the expected demand over the next 8 years.”

And yet, according to this October 4th article, the largest egg producer in the U.S. (Cal-Maine) suggests there is an over-supply of cage-free eggs and retailers are having to offer significant discounts to move them off the shelf.  Here is what Cal-Maine said in their press release:

“our largest customers, have made public commitments to transition away from conventional eggs and exclusively offer cage-free eggs by future specified dates. However, the higher price gap between conventional eggs and specialty eggs has resulted in reduced demand for specialty eggs. We have adjusted our production levels in line with current customer demand for cage-free eggs, and we are well positioned to increase our capacity when demand trends change.”

The shortage of cage free eggs mentioned by the USDA refers to the gap between the future promises and comments made by retailers and others to go cage free and the current level of cage free production.  The oversupply of cage free eggs mentioned by Cal-Maine is referring to the gap between the current number of cage free eggs being produced and what the final consumers are currently willing to pay and buy. 

At some point there will have to be a reckoning between the long term commitments by retailers to go cage free and the willingness of real-life consumers to cover the added costs of cage free eggs.  Consumer demand will have to shift out as more cage free eggs come on the market, retailers will have to live with selling fewer eggs, or some of the cage free commitments will ultimately have to be receded.  

Trends in Animal Welfare Concerns and Meat Demand

I'm preparing a talk at next week's annual meeting of the Agricultural and Applied Economics Association (AAEA) on trends in consumer concerns about animal welfare, and I thought while I'm at it I'd share a few of the results here.  All the results below come from the Food Demand Survey (FooDS), a monthly survey of over 1,000 consumers that has been ongoing for over four years (each of the graphs below contains information obtained from more than 48,000 survey responses).

One of the first things we ask in the FooDS relates to "food values".  A list of 12 items is presented to respondents and they are asked which are most/least important when buying food.  Respondents have to click and drag four of the items into a "most important" box and also put four in a "least important" box, leaving four in neither box.  The nice thing about this questioning approach is that it requires a tradeoff - respondents can't say all issues are important and they have to indicate some as least important.  To create a scale of importance, I simply calculate the percent of times an issue is placed in the most important box and subtract it from the percent of times it is in the least important box, creating a measure that ranges from 100% to -100%.  

So, where does animal welfare fall in importance?  As the graph shows, it is 7th in the middle of the pack (this graph combines all the data from the last four years).  Animal welfare is much less important than taste, safety, nutrition and price but more important than origin, fairness, or novelty.  About 18% of consumers place animal welfare in the most important box and 31% place it in the least important box, creating a score of 18%-31%=-14%

The importance of animal welfare has increased a bit over time.  Here are the month-by-month averages going back more than four years.  Animal welfare importance has remained fairly stable for the past year, hovering around -10%, but this is higher than in 2013, when it was as low as -20%.

One question that might arise is "so what"?  Do these statements of importance on animal welfare and other food values have any relation to meat demand?  The answer is "yes" - there are some strong correlations.  In FooDS, we also ask people to make nine choices between different cuts of meat (and two non-meat items) at different prices.  A crude index of demand can be calculated as the number of times (out of nine) a meat product, say beef steak, is selected minus the number of times (out of nine) a non-meat item is selected (this produces a measure that ranges from -9 to +9).  Here are estimated relationships between food values and demand for steak and ground beef (controlling for demographics and other factors). 

Relationship between food values and steak demand

Relationship between food values and ground beef

The above graphs show that people who have higher concern for animal welfare have lower demand for steak and ground beef (recall the vertical axis is a demand index that ranges from -9 to +9; for reference the mean demand index for steak is 0.9 and the mean for ground beef is 1.32).

Results indicate that if an individual who indicated animal welfare as the most important food value (a score of +1) instead indicated animal welfare as a least important food value (a score of -1), steak would be chosen -0.42 fewer times on average. Similarly for nutrition, results indicate that if an individual who indicated nutrition as the most important food value (a score of +1) instead indicated nutrition as a least important food value (a score of -1), steak would be chosen -0.33 fewer times on average.  Conversely, people who think taste and appearance are relatively important food values have higher demand for steak and ground beef.  Not surprisingly, importance on price is a positive contributor for ground beef demand but a negative contributor for steak demand.   If an individual with the four most favorable food values for steak demand were replaced with an individual with the four least favorable food values, then steak demand would increase by 2.49 (given that the mean is 0.9, this is a very large change). The take-home: to the extent animal welfare increases in importance over time, these results suggest demand for beef will fall (I find similar results for pork and chicken products too).  

By, the way, I can place these food values in the context of other correlates with demand.  Here is a comparison of different determinants of steak demand (the upper left-hand image is the food values graph that was already shown but rescaled so comparisons are made to the lowest impact).  Next to food values, household income, political ideology, and gender have the biggest impacts on steak demand.  Steak demand is higher for higher income and more conservative individuals and for males.  

Correlates with Steak Demand

In FooDS, we also ask, for more than 16 different issues,  “Overall, how much have you heard or read about each of the following topics in the past two weeks” and we classify responses as 1=nothing; 2=a little; 3=a moderate amount; 4=quite a bit; 5=a great deal.  Below are the results pertaining to animal welfare related issues.

Awareness of issues in the news over time

Result seem to suggest an up-tick in awareness of animal-welfare related issues during 2016, which subsequently declined.  However, this increase in awareness also occurred for ALL the issues we track (the solid black line), many of which (like E. Coli, pink slime, etc) have nothing to do with animal welfare.  

A similar pattern emerges in relation to "concern" for the same set of 16 or so issues over time.  We ask, “How concerned are you that the following pose a health hazard in the food that you eat in the next two weeks”, where 1=very unconcerned; 2= somewhat unconcerned; 3=neither concerned nor unconcerned; 4=somewhat concerned; 5=very concerned.  (Yes, I realize, asking whether animal welfare is a "health hazard" is strange, but that's what data I have).  The graph below slows a slight uptick in concern for animal welfare related issues, but this is also true for ALL the issues we track (the solid black line).  In other words, people don't seem to be discriminating much between animal welfare and other food issues.  

Concern for various issues over time

Finally, one of the questions we ask every month is whether respondents are vegetarian or vegan.  There has been an increase in this self-reported measure over time (see here or here for my previous discussions of these data).  In early 2014, the figure was between 3% and 4% of respondents.  This has roughly doubled and we now routinely see values between 7% and 8% of respondents self-identifying as vegetarian or vegan.  

Are you a vegetarian of vegan?  (% saying "yes")

Subsidizing Backyard Chickens?

There are a lot of really bad food policy proposals.  But, this one take the cake.  Apparently the city of Austin, TX is subsidizing backyard chicken coops.  

“The city announced Thursday that as a part of Austin Resource Recovery’s Home Composting Rebate Program, Austinites can attend one of five “chicken keeping classes,” buy a chicken coop, submit a rebate application online and receive a $75 check from the city.

Austin Resource Recovery is promoting the program as a way for Austinites to help reach the city’s Zero Waste goal by keeping food waste out of the landfill.”

A few questions come to mind.  What happens to the waste that comes out of the chickens?  Does this waste (and the smell and the sound) impose externalities on neighbors?  What happens to the hens who have reached the end of their egg-laying life?  What happens to the hens who, whoops, turn out to be roosters.  Bird flu?  Will the chickens be protected from preditors and extreme weather conditions?  How much does it cost to maintain the chickens and how expensive is supplemental feed and veterinary care?

I'm not necessarily trying to discourage backyard chickens.  I just want to know why taxpayer A should be required to pay for person B's chickens?  If the problem is food waste, and supposing it causes some unmentioned externalities, why not just increase the price of garbage pick-up?  Then households can respond in whatever ways they find most effective and convenient.  I doubt, for most, that chickens are the optimal solution.      

Food Demand Survey (FooDS) - April 2017

The April 2017 edition of the Food Demand Survey (FooDS) is now out. 

A few comments on the regular tracking portion of the survey:

• Willingness-to-pay for all meat products (except deli ham) fell from March to April.
• WTP for pork chops reached the lowest point in the almost four-year history of food.  
• Comparing April 2017 to April 2016, only WTP for hamburger is higher than was the case a year ago.
• Awareness of bird flu in the news fell this month and concern for bird flu as a food safety issue experienced the smallest increase of any of the issues studied.  Awareness and concern for animal welfare issues rose this month.

We added several new ad-hoc questions to the survey this month.  

There has been a lot of discussion in the news about whether hydroponics should be able to be labeled organic.  We put the question to our participants.  They  were asked: “Do you think hydroponic vegetables should be allowed, under certain conditions, to be labeled organic? (note: hydroponic vegetables are grown without soil - their roots grow in water with added nutrients and minerals)” 

About 46% of participants stated “yes”, hydroponic vegetables should be labeled organic, 24% said “no”, and the remaining 29% said “I don’t know”.   It should be noted that due to a glitch in survey administration, only 250 people answered this particular question and as such, the sampling error is higher than usual (it is +/-6% rather than the usual +/- 3%).

A couple weeks ago, I discussed some research we'd conducted studying when consumers don't want to know about certain agricultural production practices.  We followed up on this research in this month's edition of FooDs.  We were interested in whether people actively sought to avoid information they may find undesirable.  

We split people into two equal sized groups.  Those in the first group were asked: “On the next page you have two choices of what to see.  You can either see a picture of how pregnant hogs are housed on a typical farm or a picture of a blank screen.  Which do you prefer?”

To check whether people simply preferred to see a blank screen in general, respondents randomly allocated to the second group were asked a similar question but instead of the option to see a picture of “how pregnant hogs are housed on a typical farm”,  they could choose between “a picture of a nature scene or a picture of a blank page.”

Fifty four percent said they wanted to see the picture of how pregnant hogs are housed.  By contrast, 46% preferred instead to see a blank page.  Thus, slightly less than half the sample actively chose to ignore free information about hog housing.  Those who preferred to see the blank screen were less concerned about farm animal welfare as a food safety risk (mean of 3.2 vs. 3.6 on the 5-point scale of concern) and placed less relative importance on animal welfare as a food value (mean of -0.116 vs. -0.097). 

Ninety one percent of respondents choose to see the nature scene.  Overall, the results suggest just about half the respondents preferred not to know how pregnant hogs are housed. 

Finally, we added some questions about food insecurity.  I'll discuss these in a separate post.