By: Christiane Schroeter, Ph.D., Agribusiness Department and STRIDE, Cal Poly, San Luis Obispo   Date: 8/17/11

With increasing obesity levels, economists are searching for tools to address the public health problems. A recent webcast hosted by CFARE and IFIC Foundation addressed how behavioral economics may improve healthful lifestyle choices. Currently, food policy is based on traditional economics. This approach investigates how we should behave given rational decision-making.  Behavioral economics investigates how we actually do behave.

The Cafeteria Conundrum
Imagine standing in a typical cafeteria at lunchtime. What would you choose for lunch? Traditional economics would assume you would choose a healthful lunch, because you know that your future health depends on what you eat today. If you were to indulge in a high-calorie lunch, traditional economics would assume you do not value your future health. Regardless of whether you indulge, behavioral economics suggests you care about your health. Behavioral economics focuses on the potential reasons why you do not always make a healthier choice. Applying behavioral economics to the cafeteria setting shows:

Cash for Cookies
 Sales of higher-calorie desserts declined when only payments for these options had to be cash instead of a credit card. Consumption of low-fat milk, water, and fresh produce increased.

Here Comes the Fruit
 Replacing higher-calorie snacks with a variety of fruit in a well-lit display at the checkout of the cafeteria increased produce consumption.

Let’s Move the Salad Bar!
 Starting a new salad bar or simply changing its location to the middle of the lunchroom showed higher consumption of salad.

Menu Labeling Goes National

In the near future, all chain restaurants with 20 or more locations will be required to show the caloric content of each food item next to its price. Traditional economics would assume that you would pay close attention to the displayed calorie information to choose a lower-calorie meal. However, behavioral economics suggests menu labeling may not yield this result:

1) If you are like most of us, you might struggle with self-control problems and may frequently overeat in chain restaurants.

2) The displayed caloric information on the menu board might be overwhelming and you might just revert back to your default choice.  Let’s face it - how many times have you read through the full menu at a fast food restaurant and carefully weighed each option for its healthfulness?

3) Dieters might consume more calories with the labeling information. If you are trying to manage your weight, you might have an idea about the calorie content of various menu items before viewing the menu information. However, if you overestimated the caloric content beforehand, you might actually choose a higher-calorie item once the accurate nutrient information is revealed on the menu board.

Behavioral economic research suggests instead displaying lower-calorie menu options prominently to increase awareness and help guide you to a healthful, lower-calorie food choice.

A Mixed Bag of Tools: What do you think?
Whether in the cafeteria or faced with menu labeling, traditional and behavioral economics are rather different.  As an economist, I believe that traditional economics is still necessary to assess consumer behavior. However, behavioral economics could complement existing approaches and create additional tools for a healthier society. What would help you to make healthier choices?