Key Takeaways:
- When food consumers are properly incentivized, they will choose healthier options.
- When financial incentives are removed, consumers are more likely to choose less healthy options by comparison.
Newswise — BALTIMORE, MD, June 9, 2023 –A recent investigation into consumer shopping behaviors related to food has revealed that when presented with a decision between lower prices and healthier options, individuals tend to prioritize lower prices.
According to the study, when temporary incentives are provided to food consumers to encourage the purchase of healthier options, they are more inclined to choose those healthier foods. However, once the discounts are removed, consumers tend to revert back to their previous behavior of selecting less healthy or less expensive alternatives.
Marit Hinnosaar from the University of Nottingham and the Centre for Economic Policy Research in London led the study titled "The Persistence of Healthy Behaviors in Food Purchasing."
Hinnosaar extensively studied the U.S. Special Supplemental Nutrition Program for Women, Infants, and Children (WIC), focusing on its impact on food purchasing patterns. WIC provides vouchers for designated food items to mothers and children under the age of 5. In 2009, the WIC policy underwent reform, altering the composition of food vouchers to promote the purchase of healthier products. To conduct her investigation, Hinnosaar analyzed household-level scanner data of grocery purchases obtained from NielsenIQ.
According to Hinnosaar, she employed a "difference-in-differences" analysis method to evaluate the immediate and long-term effects of the healthier choice incentive program. The program primarily focused on promoting healthier options within specific product categories, namely bread and milk.
Hinnosaar states that the evidence indicates a decline in the purchase of healthier options once participants exit the program.
"During the incentive program, participants were only able to use vouchers for whole wheat bread and low-fat milk," she explains. "Since these options often come at a higher cost, when the vouchers were no longer provided for these products, consumers tended to prioritize price when making their choices."
However, there was no noticeable change in the overall quantities of products included in the WIC vouchers, both during and after the program. These products encompassed bread, milk, fruits and vegetables, juice, eggs, and cereal.
These findings suggest that providing a modest subsidy for healthier food choices after participants leave the program could potentially extend the program's impact and promote long-term healthier food purchases in a sustainable manner.
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