Effects of restaurant menu labels

Brenna Ellison, David Davis, and I have a paper forthcoming in the journal Economic Inquiry and that is finally available online.

Here's are the study objectives:

The overall purpose of this research is to perform an in-depth examination of menu labeling and pricing policies in a full-service, sit-down restaurant. Specifically, this research determines: (1) whether caloric labels in a fullservice restaurant influence food choice, (2) whether symbolic calorie labels are more/less influential than numeric calorie labels, (3) how effective menu labels are relative to “fat taxes” and “thin subsidies” at reducing calories ordered, and (4) the economic value of menu labels.

Our projections of the short-run effects of different policies (numeric label, symbolic label, 10% tax on high calorie items, or 10% subsidy on low calorie items) on the number of calories ordered at the restaurant we studied are as follows:


The only policy option which resulted in a statistically significant change in calories (where the 95% confidence interval on the change didn't include zero) was a "symbolic" calorie label - essentially a traffic light label with a red dot next t the highest calorie items, a yellow dot next to medium calorie items, and a green dot next to lowest calorie items.  We put the point estimate on the value of the symbolic label at about $0.13/person/meal.

It is important to note that the symbolic label policy option was also the one that had the most detrimental effect on restaurant revenues (these results are in Brenna's dissertation).  Also, curiously enough, Brenna's surveys suggest most people say they don't want the symbolic label.  Here's what we wrote in a different paper discussing a post-meal survey conducted with some of the diners:

Interestingly, despite the calorie+traffic light label’s effectiveness at reducing calories ordered, it was not the labeling format of choice. When asked which labeling format was preferred, only 27.5% of respondents wanted to see the calorie+traffic light label on their menus. Surprisingly, 42% preferred the calorie-only label which had virtually no influence on ordering behavior.