Can a sustainability facts label reduce the halo surrounding organic labels?

A couple years ago I wrote a post about a hypothetical sustainability facts label that is analogous to exiting the nutrition facts panels. In that post, I conjectured that a sustainability facts panel might help alleviate some of the misperceptions some consumers have with regard to various labeling claims. Turns out Sofia Villas-Boas at Berkeley and Zack Neuhofer, a PhD student working with me at Purdue, were simultaneously having similar ideas. As such, we teamed up to test some of these conjectures.

The result is a new paper forthcoming in Applied Economics Perspectives and Policy. Here’s the abstract.

“Consumers often form beliefs about credence attributes unsupported by the best available evidence. In particular, prior research has revealed many consumers have overly-optimistic beliefs about the environmental and nutritional impacts of organic food. We propose and study the effects of a sustainability facts label (SFL), which displays quantitative environmental information related to global warming potential, land use, and energy use per serving size of the product. The SFL is akin to a nutrition facts label (NFL), which we also study. We surveyed a nationally representative sample of milk consumers in the United States (USA) to measure their choices and beliefs about organic vs. conventional milk under one of three different label information treatments; the NFL only, the SFL only, and both labels relative to a control without any nutrition or sustainability information. Unexpectedly, our results show that the SFL increased the likelihood of organic purchases. Facts panels altered beliefs; The participants exposed to the SFL increased their perception that organic performs better on environmental metrics, despite the fact the information contained in the label provided a nuanced picture with organic better in some dimensions and worse in others. Consistent with the information provided, consumers exposed to the NFL decreased their perception that organic had fewer calories and more protein than conventional milk. Prior beliefs about organic were found to be important determinants of choice and information acquisition.”

Kudos to Zack who did the heavy lifting on this project. As it turns out, we didn’t find much support for the original conjecture but instead found a more complex and nuanced set of reactions to “objective” sustainability labels.

Public Understanding of and Attitudes Toward Bio-Based Labels and Claims

I recently completed a new study for the Plant Based Product Council exploring consumer understanding and attitudes toward bio-based labels and claims.

Given the lack of harmonization and potential public confusion around terms used to describe the bioeconomy, a survey was designed to to determine consumer knowledge, beliefs, and preferences for the following 10 terms: biobased, biodegradable, bioeconomy, bioplastics, biopolymer, circular economy, compostable, organic, plant-based, and recyclable. I conducted a nationwide survey of about 1,500 U.S. residents to explore these issues (note: topline results reporting the share of respondents falling in every response category for every question asked in the survey is provided here).

Here are some of the key findings:

• Self-assessed, subjective knowledge of bio-based related terms is low. About half the public has never heard the terms biopolymer, circular economy, or bioeconomy; more than half have either not heard or indicate not knowing the meaning of the terms biobased and bioplastics. By contrast, a majority of respondents said they were either somewhat or very knowledgeable of the terms: recyclable, organic, plant-based, biodegradable, and compostable.

• Generally, respondents indicated ignorance in knowing whether products that were biopolymers, bioplastic, biobased, or from the circular economy or bioeconomy were or could be recyclable, compostable, or organic.

• Responses to true/false and definition-matching questions reveal wide dispersion across the public in objective knowledge of bio-based and related terms. Only 0.6% of respondents answered 90% or more of the questions correctly. Forty six percent of respondents answered more questions incorrectly than correctly, and another 11% answered as many questing right as wrong. For example, only 27% of respondents correctly indicated it was false that “All biodegradable products are compostable.”

• More respondents than not provided incorrect definitions for biodegradable, compostable, organic, and biobased. Respondents were particularly likely to mistake the definition of biodegradable for composable, biobased for organic, and plant-based for biobased. White, non-Hispanics, middle-aged, higher educated individuals, particularly those with graduate degrees, exhibited higher objective knowledge of biobased and related terms, on average, than non-white, young, elderly, or people whose highest education was a high school degree.

• Compostable, plant-based, organic, biodegradable, and recyclable products were perceived to be high in sustainability and environmental friendliness; the opposite was true of animal-based and especially fossil-fuel based products. Recyclable and compostable products were viewed as relatively affordable whereas organic products were not. Recyclable products were perceived as relatively low in quality whereas organic was perceived as high quality.

• Perceptually, respondents tend to view terms like organic and plant-based as being highly similar and related to another grouping of perceptually similar terms: biodegradable, compostable, and recyclable. Perceptually, respondents view all other terms with a “bio” prefix similarly: biobased, biopolymer, bioplastic, bioeconomy. Terms viewed as most dissimilar to the rest include circular economy, fossil-fuel based, and animal-based.

• Simulated shopping choices indicate respondents are willing to pay significant premiums for take-away food in compostable, plant-based, or recyclable packaging while placing discounts on biobased and bioplastic packaging. Preferences for plant-based, compostable, and bio-based packaging are heavily influenced by the presence/absence of other label/claims, indicating consumers view these terms as having strong complementarity or substitutability relationships with other labels/claims.

• Choices are significantly impacted by disclosures providing definitions of label terms. Providing definitional disclosures increased willingness-to-pay and choice likelihood for compostable packaging while having the opposite effect for biodegradable packaging, at least when these labels appeared in isolation.

• Providing definitional information tends to reduce the size of the preference interactions between labels. When packaging already contains many competing claims/labels, provision of information disclosures increases the value of adding a new biobased claim in all instances. However, when adding a single label/claim in the absence of any others, definitional information reduces willingness-to-pay and choice probability for four terms (biodegradable, recyclable, plant-based, and biobased) while increasing it for two terms (bioplastic and compostable). These findings indicate definitional information tends to cause respondents to be more likely to

You can read the whole report here.

The Transition to Cage-Free Eggs

That’s the title of a new research report I co-authored with Vincenzina Caputo and Aaron Staples at Michigan State University and Glynn Tonsor at Kansas State University. The research was funded both by egg producers, represented by the United Egg Producers (EUP) and the United Egg Association, and by food retailers, represented by the Food Industry Association Foundation (FMI Foundation).

Here is some motivation for the study:

“State regulations, retailer pledges, and final consumer demand have contributed to a rising share of egg-laying hens housed in cage-free systems over the past decade. Nonetheless, conversion from conventional to cage-free housing is costly for both egg producers and final consumers. As such, there remains uncertainty about the extent to which egg producers will be willing and able to continue the transition to cage-free housing at a rate commensurate with retailers’ cage-free pledges. To explore this issue, this study investigates the challenges and opportunities associated with the transition to cage-free housing, including interviews with and a survey of egg producers, a survey of egg consumers, and economic modeling of the sector”

There is a lot in the nearly 100-page report, but a two-page summary document is here. Highlights are below.

Consumer Food Insights - January 2023

The January 2023 edition of our Consumer Food Insights (CFI) survey is now out. This marks the 1 year anniversary of the inaugural edition of CFI, such that we can calculate year-over-year changes and now compare current estimates to the 2022 benchmark. Thanks to the members of the Center for Food Demand Analysis (CFDAS), particularly Sam Polzin, who have done a masterful job getting the survey out the door every month and expertly analyzing and reporting the results.

Given the new year, we asked respondents if they made any resolutions related to food and nutrition. About 1 in 5 said “yes.” All respondents were asked if they planned to make changes in their eating and exercising habits in the New Year. Here’s how people prioritized different activities.

Respondents said they planned to eat more fruits and vegetables, exercise more, and eat fewer snacks; they were least likely to say they would be eating less meat or growing their own food.

We ask a question every month about whether people were unable to find specific items when shopping. If someone says “yes” indicating a stock-out, which ask which items were missing. Below is the comparison from December to January. There was a dramatic increase in the number of people who said eggs were missing over this one month period over the same period egg prices spiked. Still, given that about 1,200 people take the survey, this implies only about (50/1200)*100 = 4.2% of respondents experienced an egg stock-out in January.

Our Sustainable Food Purchasing Index (SPI) remains fairly steady, but compared to last year, there is an improvement in taste, economic, security, and nutrition dimensions of sustainability. The environment indicator dipped a bit.

Consumers’ spending on food away from home (i.e., restaurants) has increased over the past three months and total food spending is up about 19% relative to the same time last year. There is an uptick in how much consumers say food prices have risen over the past 12 months, but they continue to expect lower rates of food price inflation for the future.

We find that our measured rate of food insecurity is essentially unchanged, although there is a dip in the share of households indicating that they have received free food from a food bank or food pantry this month.

This month we added some new questions on risk taking in different domains. On average people say they are not strongly risk averse (score of zero) or strongly risk loving (score of 10) - with an average score of 5.4. However, when asked the same question about their health, people are more conservative (average of 4.3). Median scores are also lower when asked about food consumption, suggesting people are less willing to take risk for health and food than for life in general.

With regard to stated food buying behaviors, we find a 9% reduction in the number of people who say they’re choosing plant-based proteins over animal proteins. This is consistent with the much discussed decline in sales of plant-based meat alternatives.

We observed some changes in consumers’ food and environmental beliefs. Fewer people today say GMOs are safe to eat or that eating meat is better for the environment than was the case last year.

Compared to last year, this month, we are seeing sizable increases in trust in food-related information from people’s personal physicians, the American Medial Association, and the Dietary Guidelines committee. Conversely, there were sizable declines in trust of food companies like Nestle, Tyson, and McDonald’s.

Finally, leading into the Farm Bill debate this year, I’ll leave this figure here indicating the degree of support/opposition for several food/ag policies (exact wording is in the full report).

The whole report is available here.

Obesity since the 1980s

In a recent article, Matthew Yglesias takes issue “that conventional wisdom seems to have settled on the idea that there was a sharp uptick in obesity starting around 1980.” He argues instead that body weights have been increasing for a long time, and that if we are looking for causes of weight gain and obesity, we need to take a longer view than simply asking “what changed” in 1980, which seems fashionable today in the Twittersphere.

Here are his final two paragraphs on possible drivers of weight gain over the past century.

“It just turns out that like a lot of things, this has some downsides. The question of what, if anything, to do about those downsides seems pretty difficult to me, but I don’t think its origins are a big causal mystery.

If anything, making the origins out to be some huge puzzle lends itself to the false suggestion that there’s a very simple and straightforward solution. The truth — that we are experiencing some downside to living in a society with a great deal of material abundance — is harder to wrestle with, since people would be pretty unhappy about policy changes that reversed the 100+ year trend toward food becoming tastier, more available, and more convenient.”

I agree - perhaps because it is awfully similar to the conclusion I reached back in 2013 in The Food Police. Here’s what I wrote then at the conclusion of the chapter on fat taxes.

“It is only reasonable that we eat a little more food when it costs less and give up manual labor when an air conditioned office job comes along. We can’t disentangle all the bad stuff we don’t like about obesity with all the good things we now enjoy, such as driving, eating snacks, cooking more quickly, and having less strenuous jobs. Yes, we can have less obesity, but at the costs of things we enjoy.

When you hear we need a fundamental change to get our waistlines back down to where they were three decades ago, beware that it might take a world that looks like it did three decades ago.”

We are unlikely to finding a simple, mono-causal explanation for the rise in obesity. That is perhaps best illustrated in the figure below from a 2006 paper by Keith et al. in the International Journal of Obesity, which plots obesity (the red dashed line with x’s) alongside either other factors that have been suggested as causes for obesity. Obviously, lots of strong positive correlations, but it shows the likely futility of finding one single, easy answer.