Thinking like an economist… about grocery stores

One good opportunity to improve public health is in grocery stores, as psychologists and economists work together to help retailers increase sales of, well…  groceries.

Today’s New York Times has a terrific news story about this frontier of research by their reporter Michael Moss.  Moss just released a lively new book about how food manufacturers raise the levels of salt, sugar, fat and other ingredients in processed foods far beyond what you’d add in your own kitchen, while research at Tufts and elsewhere has shown similar problems in restaurant food.  In contrast, grocery stores sell a lot of fruits, vegetables and other relatively healthy stuff,  generally around the perimeter of the store.  So, in the choice between processed foods, restaurant foods, and plain old groceries, what determines how consumers’ spend their hard-earned money?

Advertising.  Taste and convenience are also important, as is factual information about nutrition and health.  But those things are often hard to change, in which case advertising can provide the swing vote that nudges consumers towards what they actually buy.  The effectiveness of advertising helps explain why we see so much of it.

The research featured in today’s NYT is about a great new display ad being tested in grocery store shopping carts:  a mirror, reflecting the shopper’s face back at them.  The researchers’ hypothesis is that commercial ads distract people from their own desires, so that a mirror reminding consumers of who they really are would nudge them back towards choices they are less likely to regret later when they leave the store.

What do you think?  Where might a mirror help you make more optimal choices?

And to continue thinking like an economist, consider the problem from the store’s point of view:  in your experience, when do they try to sell you things you might later regret, as opposed to helping you find things that actually fit the long-term you?


Thinking like an economist… about pregnancy

I like to listen to podcasts when I run, mostly fun stuff from Slate and the BBC, also stories (both true and fictional)  and sometimes great lectures.  If you already listen to podcasts, or might want to get started, here’s a great one offering 20 minutes of econotainment to ease your commute or whatever: Planet Money’s Episode 481: The Economist’s Guide To Drinking While Pregnant.

Our week 1 exercise asks students to describe an instance of thinking like an economist — that is, trying to explain individuals’ choices as if each is doing the best they can under their circumstances, and then interacting with others towards a potentially predictable result. Looking at social life as an equilibrium among optimizers cannot explain everything, but it can be useful and also a lot of fun.

The Planet Money podcast interviews Emily Oster, a famous economist (meaning, famous among economists) who’s written a new book on choices in pregnancy.  It turns out that most people don’t think like economists at all when they decide what to eat or do during pregnancy.  For example, when people are optimizing, we think at the margin about incremental changes — should I drink one sip of wine?  how about a half glass?  or a whole glass?  But when people are pregnant, the rules tend to be absolute:  no wine!

Emily Oster’s great story is about that kind of paradox.  It turns out, that real people don’t actually optimize all the time — the calculations and subtleties would make our heads explode.  So we construct simple rules that clearly are not themselves optimal, but might be a predictable equilibrium among optimizing people — doctors who need to tell lots of people the same thing, and prospective parents who have better things to think about than relative risk ratios and complicated probabilities.  When we become aware of that we can perhaps overcome some of those limitations, and make arrangements to reach a much better equilibrium.

In other words, actually thinking like an economist is pretty weird…  but do you find it useful?  fun?  Listen and let us know how you see Plant Money’s great podcast on The Economist’s Guide To Drinking While Pregnant!


Wow… the class opens for previewing tomorrow.  Official first day will be September 3rd, but if you’re as keen to start as I am, you can check out the welcome videos and course details our new Trunk site!

I look forward to working with our students there — and if you’re here as a tourist checking out the blog, come back soon for their posts as the semester progresses.




Test-tube Meat!

The very first laboratory-grown burger was taste-tested recently in London. This is an amazing scientific advancement, that’s just a little bit icky! Here’s a Washington Post article about the taste test. There’s lots of discussion now about whether lab-grown meat could help solve world hunger, given the huge land + feed+ water + other stuff expense of raising beef in the field.

People are saying that the “hunger problem” in the world is not fundamentally a scarcity problem, it’s a poverty problem. There’s enough food, it’s just people are too poor to access it. This point embodies a lot of Amartya Sen‘s ideas on the entitlement approach (failure of exchange entitlements).

As we will learn in class when we talk about food demand: when people’s incomes increase, the types and quality of food they want to eat changes. We will also learn about whether and how the quantity of food demanded changes as income changes…do you think people want to eat more calories as their incomes go up? What shape might that graph look have, with income on the x-axis and calories “demanded” on the y-axis?

So, what do you think? Do you think test-tube burgers could eventually supplement real meat in the diet? Do you think test-tube burgers could help solve world hunger? What about the nutritional considerations? There are many micronutrient deficiencies which could be fixed by including some animal products in the diet… (vitamin A, iron, iodine….)!

Helpful Links

On the right hand side of this course blog/site, you will find links to useful data sources and news sources.

These sites may help jump-start your assignments that involve working with real data or analyzing current events. If you find another helpful source, please let us know and we can add it!

The continuing debate on SNAP restrictions

There has been a lot of discussion and debate lately about placing further restrictions on the types of food that SNAP (Supplemental Nutrition Assistance Program, the new name for the food stamp program) participants can purchase. For example, alcohol is already not allowed. Here is a nice article from outlining the controversy.

The SNAP program issues pre-paid debit cards to participants, which they can use at grocery stores or convenience stores, and even some farmers’ markets (but not restaurants). So, what do you expect the impact of the SNAP program to be on the demand for food? What types of “food bundles” do you expect people to buy? What are some factors that will influence the foods that people buy? When you go to the store, how important is price versus taste?

This debate seems to have been ignited by the epidemiology of obesity and non-communicable diseases in the U.S. People started asking: since low-income people are more likely to be overweight, why do they need help buying food? Well, that brings us automatically to another interesting question: are healthy diets cheaper, or more expensive? Professor Adam Drewnowski of the University of Washington has done lots of research on this topic, if you’re interested to check it out.