Last week, Scientific American published a piece on how to get people to eat less meat. Apparently, the science is settled and we now only need to come up with the right "messages."
There are an awful lot of apocalyptic pronouncements about the adverse effects of meat eating on the environment. In a widely viewed TED talk, Mark Bittman likens meat production to a nuclear explosion and says it is leading to a "holocaust of a different kind," pointing directly to impacts on climate change. As another example, Bill Maher, comedian and host of an HBO talk show, has written, “But when it comes to bad for the environment, nothing—literally—compares with eating meat. . . . If you care about the planet, it’s actually better to eat a salad in a Hummer than a cheeseburger in a Prius.” I could, quite literally, provide dozens of these sorts of quotes from well known journals, writers, actors, etc, but I think you get the point. The overall message is pretty clear: we should become increasingly more vegetarian.
Let's take a look at one of the outcomes people are most worried about and where externality is relatively clear: climate change. I went to the EPA's calculations, and surmise the following carbon equivalent impacts for the US attributable to beef cattle, swine, and poultry production during the year 2014 (MMT is million metric tons):
- beef cattle: 116.7 MMT C02 (from digestion) + 4 MMT C02 (from waste management) = 119.7 MMT C02;
- swine: 1 MMT C02 (from digestion) + 22.4 MMT C02 (from waste management) = 23.4 MMT C02; and
- poultry: 0 MMT C02 (from digestion) + 3.2 MMT C02 (from waste management) = 3.2 MMT C02.
Elsewhere, the EPA suggests using using a social cost of carbon of $36/metric ton of C02 (assuming a discount rate of 3%) for cost benefit analysis and rule making. Multiplying the C02 impacts above by the price tag of $36 implies the following total carbon costs in 2014.
- beef cattle: $4.3 billion;
- swine: $842 million; and
- poultry: $115 million.
That seem like a lot, but keep in mind that we also eat a lot of meat. Data from the USDA suggests that in 2014, farmers/ranchers in the US produced 24.32 billion pounds of beef, 22.86 billion lbs of pork, and 44.98 billion lbs of poultry. Putting the carbon costs on a per-pound basis (i.e., dividing total carbon cost by pounds produced), suggests the following.
- beef: $0.177/lb;
- pork: $0.037/lb; and
- poultry: $0.002/lb.
I don't know about you, but those don't seem like enormous costs. Let's think about it a different way. Suppose you wanted to "internalize" the the impacts you're having on climate change by altering how much beef, pork, and poultry you buy. To do this, take the price you see at the grocery store and add about $0.18/lb to the price of beef, $0.04/lb to the price of pork, and less than a penny to the price of poultry, and act as if these were the prices actually being charged. Would you change your behavior much based on such price increase? If not, we'd could say the climate impacts are relatively small.
I saw the following from the economist Bob Lawson on twitter this weekend.
If you have ever said "externality" but don't understand that the optimal amount of pollution >0, then you're doing it wrong.— Bob Lawson (@doclawson12) April 17, 2016
The key isn't to have zero greenhouse gas impacts, but rather to to make sure you're taking into account the cost of those impacts. For the case of beef, that means acting as if the price were about $0.17/lb higher. Do that and you can shop away, guilt free (well, at least the guilt of carbon impacts).
P.S. USDA data suggests the retail price of beef in 2014 was around $5.60/lb. An $0.18/lb price increase would represent about a 3% increase in the price of beef. Assuming the own-price elasticity of demand is, say, -0.6, this price increase would lead to a 1.9% reduction in the quantity of beef demanded. So, to internalize the carbon impacts of beef eating, Americans would reduce beef consumption by 1.9%. It's not zero but its a far cry from vegetarianism.