Earlier today, I had the pleasure of participating in a Munk-style debate at the (virtual) 11th Annual Canadian Agri-Food Policy Conference hosted by the Canadian Agricultural Economics Society,
The proposition up for debate was: “Government policies seeking to reduce food waste are an effective means of addressing food security.”
I was asked to take on side against the proposition. Mike von Massow from the University of Guelph took on the side in favor, and Brady Deaton, also from University of Guelph, moderated.
Below was my opening statement.
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It is a pleasure to be with you all today. Thank you for the opportunity to weigh in on this important issue.
I want to start off looking at the proposition that is before us and defining some terms. My task here today is not to convince you that food waste is unproblematic, that food insecurity is acceptable, or that government actions can’t reduce food insecurity. Rather, my task is much narrower. In particular, I aim to demonstrate that food waste reduction is not an effective or efficient means of improving food security; not only that – but government policies, specifically, are likely to be ineffective and inefficient in reducing food security through the means of reducing waste.
What is waste? Food waste is often discussed as an accounting concept, as the gap between what is produced and what is consumed. The implicit idea is that if we narrow the gap, we can save the many resources, including land, water, and energy, that went into producing the food. But, this begs the question: why is there a gap in the first place, and would we really “save” resources by trying to narrow it? Seen in this light, food waste is an economic concept. A challenge with the simplistic notation of waste reduction is that food is discarded in a competitive environment where consumers or producers are generally trying to do the best they can to improve their well-being. Presumably, if more money were to be made by farmers, food processors, or grocers reducing waste, they would do it. Similarly, consumers too would have to give up time or flavor or safety to achieve less food waste. Even if there are externalities or behavioral biases, my opponent would need to articulate a specific market failure that a government policy would ameliorate, and demonstrate that the “fix” actually improves food security. Rather, food waste is the result of a complex equilibrium affected by consumers (including their preferences for convenience, expectations about future food prices and availability, and food safety concerns) and producers (and their cost of holding inventory, cost of transportation and storage, and liability and reputational concerns). Thus, at the onset, I hope to abuse you of the general, and widely held, notion that reductions in food waste are a free lunch
Now, let’s turn to some specific points related to the proposition. I have two main arguments. First, most commonly conceived government policies aiming to reduce food waste would not, in fact, increase the supply of food at any given time, and may in fact do the opposite; thus, not helping food security. Second, if the aim is to improve food insecurity, attempting to do that through reductions in food waste is inefficient and ineffective, and there are likely less costly means to achieve the same end at lower cost and with fewer unintended consequences.
On the first point – would food waste reducing policies actually increase the supply of food for low income households? In developing countries, the bulk of waste occurs at the household level; thus, common approaches of trying to reducing waste involve try to convince consumers, through taxes or information campaigns, to consume all of what they buy and throw out less. Our stomachs and pantries are only so large, and as a result, this presumably means consumers would ultimately buy less food. In economic terms, this leads to a downward shift in demand, which ultimately results in lower prices and, importantly, less food produced and consumed. Less food produced and consumed does NOT sound positive for food security. Moreover, for farmers, this is certainly a bad outcome: selling less food at lower prices means lower revenues and profits.
The recent experience of COVID-19 disruptions is also illustrative in this regard. In mid-March, foot traffic in groceries increased markedly, leading to stock-outs and empty shelves for many basic foodstuffs. Consumers expressed fear and frustration over the stock-outs. However, prior to the onset of the pandemic, groceries and food manufacturers had been under pressure (from investors, politicians, and regulatory bodies) to adopt just-in-time delivery and effectively manage inventories to help prevent waste of perishable food items. As the pandemic revealed, however, systems designed to help prevent food waste, are not well suited to withstand the large, temporary demand spikes like that seen after COVID-19 hit North America. Indeed, one way to reduce risk of severe food insecurity is to hold emergency inventories and stockpiles (which might well eventually go to waste) to make sure you have enough to eat when things get really bad – whether a pandemic, animal/plant disease, or drought comes. Seen in this way, “waste” is a cost that must be paid as a form of insurance against unexpected events. Without such insurance, hunger would almost certainly be higher.
There is also a naïve sense that much of what would “wasted” can simply be re-allocated to food insecure households. So, what is “waste” exactly? Consumers buy raw ingredients like apples, steaks, and avocados; are we to solve food insecurity by providing low-income households inedible cores, bones, seeds, and skins? What of milk that has soured, bread that has molded, or bananas that have browned? Would food security be improved by trying to convince people to take on food safety risks and consume such products? Rather, feeding such items to livestock seems a far better solution to help increase the supply of meat and dairy products, even if some call that “wasteful.” Even if food discarded by a household might become inputs into other. albeit less productive, production processes such as composting or by a municipality using an anaerobic digester to produces fuel – this does not improve food insecurity.
My second argument relates to the effectiveness and efficiency of policies aiming to improve food security through food waste reduction policies. Reducing food insecurity is a laudable goal. Fortunately, we have proven policies that really help with minimal deadweight loss; in the U.S. we have the Supplemental Nutrition Assistance Program (sometimes known as “food stamps”) that provides low income households resources to buy food. The program is means tested, well-targeted, and has been shown to significantly reduce food insecurity. Moreover, because the program is essentially a cash transfer, there are little to know social costs or deadweight loss, other than those that come about from administering the program. Food insecure Canadians would be far better served with the inaction of such a food assistance program than policies aiming to curb food waste.
Additionally, policies to reduce waste are likely to have unintended and undesirable costly effects. Demand side strategies to reduce waste, for example, might rely on educational campaigns such as Canada’s Love Food Hate Waste campaign. If consumers attempt to reduce waste by “cleaning their plate” and eat more food, this would likely have adverse effects associated with the costs of increased overweightness and obesity.
Another potential undesirable effect is that that “waste taxes” are likely to be regressive – hurting the very people that presumable we are trying to help by reducing food insecurity. A well-established empirical phenomenon is that lower income households spend a higher share of their incomes on food, meaning they are bear a proportionately higher burden of policies that increase the price of food. It is also worth noting that there are several studies showing food waste is a “normal” good – rising with income; low income households tend to waste less because they face greater incentives to economize and they spend less on food away from home, where waste tends to be higher. Thus, lower income households (those most at risk for food insecurity) face many private economic incentives to reduce waste and hardly need to be the target of additional policy scrutiny “helping” them make better use of their meager resources.
In pursuing policies to reduce food waste, my fear is that we end up wasting more than we save. Let’s be sure we don’t waste what is one of our most important and precious resources: our time and energy. Rather, let’s use our time and energy to find more effective ways to help people who are hungry.
For these reasons, I encourage you to join me in voting against the proposition.
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The approximately 150 attendees were asked whether they agreed, disagreed, or were uncertain about the proposition both before and after the debate. Before, the figures were 41% agree, 32% disagree, 27% uncertain. After, the figures were 29% agree, 55% disagree, and 16% uncertain.