The Ebbs and Flows of Fashionable Food

A recent article in Forbes ran under the headline “Regenerative Agriculture: The Next Trend In Food Retailing.” It appears regenerative is a trend that is taking a while to get going. Here is my comment on an article in the New York Times from almost exactly one year ago today.

Regenerative is the new sustainable, which was the new local, which was the new organic. It's a halo treadmill. And, a corporatization treadmill. https://t.co/RNDBGBo33U

— Jayson Lusk (@JaysonLusk) August 28, 2020

As shown in the figure below - taken from a presentation I gave about a month ago - Time Magazine had a cover image that said “Forget Organic. Eat Local” back on 2007. We subsequently seemed to move from local to sustainable. Now it’s regenerative. Next, it will be something else.

What causes the rise and fall, or rather the rise and plateau, of various food marketing claims?

None of these movements would have any traction if there wasn’t at least some underlying demand from consumers and investors for lowering the environmental impacts of food production, improving our health, giving farm animals a desirable life, or improving incomes of small farmers. That these base concerns exist provides the context for new movements to make their case for a place on dinner plates. Given that background context, upswings of food movements are driven the following factors.

• Desire for authenticity and trustworthiness,

• Myth making and seeking (“silver bullet” solutions that solve all the food system ills - environment, health, food security, and otherwise - seem particularly persuasive),

• Romanticism of the small and natural,

• Status-seeking (food as fashion), and

• A core of committee devotees who are able to garner institutional support for the movement.

At some point, these movements lose their luster and become blasé. It’s not that the movement “dies” (e.g., organic food still appears to be experiencing strong sales growth), but rather the movements eventually lose their moral force and cultural cache. Why?

Here are a few thoughts.

• As a movement grows, there is a need for standardization. What, exactly, is “local”? Food grown in your same state? Or region? Within 100 miles? Or 50 miles? What is “regenerative”? I still don’t know the answer to the last one. In the case of organic, competing definitions and conflicting standards ultimately led to U.S. federal standards and a certification program in 2002. While certification helps improve transparency and consumer communication, choices made in the process can alienate “true believers.” Consider, for example, the contentious issue of whether hydroponic crops can obtain an organic certification. Whatever decision the USDA made on that question (and countless others) was going to create winners and losers, with some people arguing that the movement has lost it’s way to gain mainstream appeal.

• Corporatization and greenwashing. When these movements are small and growing and attracting consumers, the profits generated attract new entrants and competition, which eventually include “Big Food” and “Big Ag.” Large players can bring new knowledge, economies of scale, and open marketing channels, which helps bring down cost and helps the movement grow. However, many of these food movements are premised on the appeal to “natural” and “small,” and in many ways the movement ideology is often antithetical to scale. The very things that need to happen to mainstream a movement undermine credibility among a certain set of movement promoters.

• Science evolves. When a movement is new and undefined, as “regenerative” is at the moment, it is easy to attach to it all of one’s hopes and dreams of food system reform. But, as the movement becomes more defined and standardized, scientists begin to conduct studies and find that the world is complex and nuanced. Studies find, for example, that organic food isn’t substantively more nutritious than conventionally produced food; and, that while organic uses fewer synthetic pesticides it also has lower yields and thus requires more land to produce the same amount of food. Studies find that localness of food has little relationship with greenhouse gas emissions. And so on. A movement loses some of its luster when it isn’t a silver bullet.

• Mainstreaming removes prestige. When everyone can have organic food, it is no longer cool to eat organic food. Part of the appeal of high-end fashion, in both clothes and food, is exclusivity. The high price point helps these products maintain their position as status symbols, but as standardization, corporatization, competition, and scale economies come about, prices often fall. For some people, and for some goods, this can lead to a type of Veblen Good Effect, where demand falls as prices fall because the good loses its position as a status symbol.

It’s unlikely we’ll ever reach a point where there aren’t ebbs and flows in sustainability-related food trends, but there may be some ways to potentially partially step off the treadmill. One possibility is to move toward more outcome-oriented and objective (rather than process-focused, subjective) sustainability labels. That said, the advent of nutrition fact panels seems to have done little to stop the cycle of dietary-related fads and trends from low fat to low carb to high protein to gluten free to plant based. Maybe these ebbs and flows are just a part of human nature.

Consumer Demand for Redundant Food Labels

That’s the title of a new working paper co-authored with Lacey Wilson. Here is the abstract:

“Previous studies, as well as market sales data, show some consumers are willing to pay a premium for redundant or superfluous food labels that carry no additional information for the informed consumer. Some advocacy groups have argued that the use of such redundant labels is misleading or unethical. To determine whether premiums for redundant labels stem from misunderstanding or other factors, this study seeks to determine whether greater knowledge of the claims - in the form of expertise in food production and scientific literacy - decreases willingness to pay for redundant labels. We also explore whether de-biasing information influences consumers’ valuations of redundant labels. An online survey of 1,122 U.S. consumers elicited preferences for three redundantly labeled products: non-GMO sea salt, gluten-free orange juice, and no-hormone-added chicken breast. Respondents with farm experience report lower premiums for non-GMO salt and no-hormone-added chicken. Those with higher scientific literacy state lower premiums for gluten-free orange juice. However, after providing information about the redundancy of the claims, less than half of respondents who were initially willing to pay extra for the label are convinced otherwise. Over 30% of respondents counter-intuitively increase their premiums, behavior that is associated with less a priori scientific knowledge. The likelihood of “overpricing” redundant labels is associated with willingness-to-pay premiums for organic food, suggesting at least some of the premium for organic is a result of misinformation.”

The figure below shows a key result. People place a $0 premium on non-GMO salt, gluten-free orange juice, and hormone-free chicken have significantly higher scientific literacy scores than people who place positive or negative premiums on these redundantly labeled products.

Organic Food Consumption and Cancer

A couple of days ago, JAMA Internal Medicine published a paper looking at the relationship between stated levels of organic food consumption and cancer among a sample of 68,946 French consumers.

The paper, and the media coverage of it, is frustrating on many fronts, and it is symptomatic of what is wrong with so many nutritional and epidemiological studies relying on observational, self reported data without a clear strategy for identifying causal effects. As I wrote a couple years ago:

“Fortunately economics (at least applied microeconomics) has undergone a bit of credibility revolution. If you attend a research seminar in virtually any economics department these days, you’re almost certain to hear questions like, “what is your identification strategy?” or “how did you deal with endogeneity or selection?” In short, the question is: how do we know the effects you’re reporting are causal effects and not just correlations.

Its high time for a credibility revolution in nutrition and epidemiology.”

Yes, Yes, the title of the paper says “association” not “causation.” But, of course, that didn’t prevent the authors - in the abstract - from concluding, “promoting organic food consumption in the general population could be a promising preventive strategy against cancer” or CNN from running a headline that says, “You can cut your cancer risk by eating organic.”

So, first, how might this be only correlation and not causation? People who consume organic foods are likely to differ from people who do not in all sorts of ways that might also affect health outcomes. As the authors clearly show in their own study, people who say they eat a lot of organic food are higher income, are better educated, are less likely to smoke and drink, eat much less meat, and have overall healthier diets than people who say they never eat organic. The authors try to “control” for these factors in a statistical analysis, but there are two problems with this. First, the devil is in the details and the way these confounding factors are measured and interact could have significant effects. More importantly, some of these missing “controls” are things like overall health consciousness, risk aversion, social conformity, and more. This leads to a second more fundamental problem. These unobserved factors are likely to be highly correlated with both organic food consumption and cancer risk, and thus the estimated effect on organic is likely biased. There are many examples of this sort of endogeneity bias, and failure to think carefully about how to handle it can lead to effects that are under- or over-estimated and can even reverse the sign of the effect.

To illustrate, suppose an unmeasured variable like health consciousness is driving both organic purchases and cancer risk. A highly health conscious person is going to undertake all sorts of activities that might lower cancer risks - seeing the doctor regularly, taking vitamins, being careful about their diet, reading new dietary studies, exercising in certain ways, etc. And, such a person might also eat more organic food, thus the correlation. The point is that even if such a highly health conscious person weren’t eating organic, they’d still have lower cancer risk. It isn’t the organic causing the lower cancer risk. Or stated differently, if we took a highly health UNconscious person and forced them to eat a lot of organic, would we expect their cancer risk to fall? If not, this is correlation and not causation.

Ideally, we’d like to conduct a randomized controlled trial (RCT) (randomly feed one group a lot of organic and another group none and compare outcomes), but these types of studies can be very expensive and time consuming. Fortunately, economists and others have come up with creative ways to try to address the unobserved variable and endogeneity issues that gets us closer to the RCT ideal, but I see no effort on the part of these authors to take these issues seriously in their analysis.

Then, there are all sorts of worrying details in the study itself. Organic food consumption is a self-reported variable measured in a very ad-hoc way. People were asked if they consumed organic most of the time (people were given 2 points), occasionally (people were given one point), or never (no points), and this was summed across 16 different food categories ranging from fruits to meats to vegetable oils. Curiously, when the authors limit their organic food variable to only plant-based sources (presumable because this is where pesticide risks are most acute), the effects for most cancers diminishes. It is also curious that the there wasn’t always a “dose response” relationship between organic consumption scores and cancer risk. Also, when the authors limit their analysis to particular sub-groups (like men), the relationship between organic consumption and cancer disappears. Tamar Haspel, a food and agricultural writer for the Washington Post, delves into some of these issues and more in a Tweet-storm.

Finally, even if the estimated effects are “true”, how big and consequential are they? The authors studied 68,946 people, 1,340 of whom were diagnosed with cancer at some point during the approximately 6 year study. So, the baseline chance of any getting any type of cancer was (1340/68,946)*100 = 1.9%, or roughly 2 people out of 100. Now, let’s look at the case where the effects seem to be the largest and most consistent across the various specifications, non-Hodgkin lymphomas (NHL). There were 47 cases of NHL, meaning there was a (47/68,946)*100 = 0.068% overall chance of getting NHL in this population over this time period. 15 and 14 people, respectively, in the lowest first and second quartiles of organic food scores had NHL, but 16 people in the third highest quartile of organic food consumption had HCL. When we get to the highest quartile of stated organic food scale, the number of people with HCL now dropped to only 2. After making various statistical adjustments, the authors calculate a “hazard ratio” of 0.14 for people in the lowest vs. highest quartiles of organic food consumption, meaning there was a whopping 86% reduction in risk. But, what does that mean relative to the baseline? It means going from a risk of 0.068% to a risk of 0.068*0.14=0.01%, or from about 7 in 10,000 to 1 in 10,000. To put these figures in perspective, the overall likelihood of someone in the population dying from a car accident next year are about 1.25 in 10,000 and are about 97 in 10,000 over the course of a lifetime. The one-year and lifetime risk from dying from a fall on stairs and steps is 0.07 in 10,000 and 5.7 in 10,000.

In sum, I'm not arguing that eating more organic food might not be causally related to reduced cancer risk, especially given the plausible causal mechanisms. Rather, I’m arguing that this particular study doesn’t go very far in helping us answer that fundamental question. And, if we do ultimately arrive at better estimates from studies that take causal identification seriously that reverse these findings, we will have undermined consumer trust by promoting these types of studies (just ask people whether they think eggs, coffee, chocolate, or blueberry increase or reduce the odds of cancer or heart disease).

Look at Me, I'm Buying Organic

That’s the title of a new paper I co-authored with Seon-Woong Kim and Wade Brorsen, which was just published in the Journal of Agricultural and Resource Economics.

We know consumers have a number of motivations for buying organic food - from perceptions about health, taste, safety, and environment to perceptions about impacts on smaller farmers. Whether these perceptions are accurate is debatable. In this paper, we were interested in an all together different motivation: the extent to which consumers feel social pressure to buy organic.

In our study, people made simulated choices between apples or milk cartons, where one of the characteristics was the presence or absence of the organic label. People were divided into one of four groups:

1) The control (CTRL): no manipulation.

2) The eye (EYE) treatment. This is going to sound crazy, but following some previous research, we showed an image of a person’s eyes on the screen as people were making their apple and milk choices. Prior research suggest that exposure to an image of eyes creates the aura of being watched, which increases reputational concerns and cooperative behavior.

3) The name (NAME) treatment. Just prior to the apple/milk choices, people in this group were asked to type in their first name, and we ask them to confirm if they lived in the location associated with their IP address. The idea was to remove the perception of anonymity and increase social pressure.

4) The friend (FRND) treatment. Here we used a vignette approach. Jut prior to the apple/milk choices, people were told, “Now, imagine you are in the specific situation described below. Your good friends have family visiting. They’ve asked you to help out by taking their sibling, whom you’ve never met, to the grocery store. While you’re there with your friend’s sibling, you also need to do some shopping for yourself.”

If social pressure is a driver of organic food purchases, willingness-to-pay for the organic label would be expected to be higher in the EYE, NAME, and FRND treatments relative to the control.

Here are some summary statistics showing the percent of choices made by consumers in each treatment group in which a product with the organic label was chosen.

We see some support for the idea that organic is more likely to be chosen in the social pressure treatments (EYE, NAME, FRND) than the control. The effects are statistically different, but that aren’t huge for every treatment considered. However, the above table doesn’t consider price differences. When we convert the choices into a measure of willingness-to-pay, we find the biggest effect is for the vignette (FRND). For this treatment, we find willingness-to-pay for organic is about 88% higher for apples and 82% higher for milk than the control.

For all groups, we found that education levels moderate the relationship between the social pressure treatment variables and willingness-to-pay for organic. In particular, social pressure is higher for more highly educated consumers. The effect was particularly large in the EYE treatment, where more highly educated consumers valued the organic label between 150% and 200% than less educated consumers when exposed to eyes.

These results provide evidence that at least a portion of organic consumption is likely driven by a form of conspicuous consumption. Some might call it a form of conspicuous conservation, but that’s a whole other can of worms.

Food Environment or Food Preferences?

“The public health literature has documented that lower income neighborhoods suffer from lower availability of healthy groceries and that lower-income households tend to eat less healthfully. In some circles, this relationship has been taken as causal, with significant policy attention devoted to improving access to healthy groceries in low-income neighborhoods.”

That's from a new paper by Hunt Allcott, Rebecca Diamond, Jean-Pierre Dubé.  This is one of the most rigorous investigations I've seen of the causal impacts of the "food environment" (in this case, the presence of grocery stores and movements of people into "healthier" neighborhoods) on dietary choice. 

What did they find?  From the conclusions:

“Entry of a new supermarket has a tightly estimated zero effect on healthy grocery purchases, and we can conclude that differential local access to supermarkets explains [no more] than about five percent of the difference in healthy eating between high- and low-income households. The data clearly show why this is the case: Americans travel a long way for shopping, so even households who live in “food deserts” with no supermarkets get most of their groceries from supermarkets. Entry of a new supermarket nearby therefore mostly diverts purchases from other supermarkets. This analysis reframes the discussion of food deserts in two ways. First, the entire notion of a “food desert” is misleading if it is based on a market definition that understates consumers’ willingness-to-travel. Second, any benefits of “combating food deserts” derive less from healthy eating and more from reducing travel costs.”

and

“we find that moving to an area where other people eat more or less healthfully does not affect households’ own healthy eating patterns, at least over the several year time horizon that the data allow. ”

The authors end by concluding that policy efforts to alter local food supplies are likely to be ineffective.  Their data strongly supports this conclusion.  They recommend, instead, to use public policy to improve health education.  I'm surprised they make this recommendation because their study provides no indication that more education would be a cost-effective intervention.  If anything, what their study shows is that economic development (turning low-income households into high-income households) is the most effective way to improve the healthiness of dietary choice.  

Hat tip to Alex Tabarrock at the Marginal Revolution blog who is highly skeptical of the food desert concept.