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Measuring the Welfare Effects of Nutrition Information
Author(s) -
Teisl Mario F.,
Bockstael Nancy E.,
Levy Alan
Publication year - 2001
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.1111/0002-9092.00142
Subject(s) - welfare , consumption (sociology) , public economics , health benefits , environmental health , social welfare , estimation , health information , economics , business , nutrient , cost–benefit analysis , health care , actuarial science , medicine , economic growth , biology , traditional medicine , ecology , social science , management , sociology , political science , law , market economy , chemistry , organic chemistry
Cost/benefit analysis justifies regulations altering the amount of health‐related information presented to consumers. The current method of benefit analysis, the cost of avoided illness, is limited; it assumes the benefits of health‐related information are adequately represented by changes in illnesses. The manuscript develops a benefit estimation method to measure the welfare impacts of providing nutrient information. Nutrient labeling significantly affects purchase behaviour but may not lead to increased consumption of health foods. Nutrient labeling may increase welfare without any change in health risk. Thus, the cost of avoided illness approach can underestimate the social benefits of providing nutrient information.