In today's episode, we're discussing the complex and urgent topic of global food demand. The United Nations Sustainable Development Goals, or SDGs, ask countries to make measurable progress in reducing poverty, achieving zero hunger, and supporting every individual in realizing good health. While also mitigating climate change, sustaining the environment and responsible consumption and production habits. Researchers have recommended sustainable diets - planetary health diets. For example, the Eat Lancet Planetary Health Diet. However, others have criticized some of these diets for not addressing the economic and social impacts of transitioning to such diets. Is it possible to balance changing diets, rising incomes, and economic growth with economic feasibility, environmental impact, and long-term sustainability? Well, that's what our goals are today. Our guests today are Andrew Muhammad of the University of Tennessee Institute of Agriculture, and Emiliano Lopez Barrera from Texas A&M. They are my co-authors on a new paper in the Annual Review of Resource Economics entitled Global Food Demand: overcoming Challenges to Healthy and Sustainable Diets.

Interview Summary

Andrew let's begin with you. Why is it important to study the economics of dietary habits and food choices in a global context?

Well, it's important for several reasons, right? When we think both about food security as well as environmental outcomes and maintaining biodiversity, in keeping both human beings and the planet healthy, we really do need to think about this in a global context. One could see agriculture as a global ecosystem where decisions in one country clearly have impacts on outcomes in others. While at the same time, we need to see food as a means by which we satisfy the demands of a global community. Whether it be through our own domestic production or international trade. And then the last thing I'll say, which is really most important are all the actual things we want to tackle and mitigate and correct, fix or improve. Whether it be the environmental issues, global food security outcomes, individual diets, mitigating obesity issues globally, right? It's pretty clear that most of the things affecting human beings in the environment as it relates to agriculture are global in nature, and there's an economic component that we need to consider when addressing these issues in a global context.

Thank you for sharing that. And I am interested to understand what the role of economics in dietary habits is as we explored it in this review paper.

In economics, this is a pretty long history, one could say going back centuries, right? This idea of how income growth impacts food spending on a household or individuals, as well as what economic affluence in development does to sort of how diets transition. And so, for example, it's been long established, right, as individuals get richer, a smaller and smaller share of their income is spent on food. So therefore, food dynamics become less important in [a developed, rich country versus a developing country where a large percentage of income is still spent on food. And what does that mean? That means that while I may find price shocks annoying, and while I may find higher grocery prices annoying, in a developing world that clearly has some implications on the nutritional needs and food decisions far more than it would have on me, for example. But the other thing which is something that has been highlighted for quite some time, and that is this transition from basic staples - from rice, grain, corn, cassava, potatoes, etc. - to more complex food products like high protein dense meat products, fish, milk, dairy, and even highly processed products that are deemed unhealthy. But the point is, as we look at the full spectrum of countries from least developed to most developed, you see this transition from basic staples to these protein dense products as well as complex processed products.

This is a really important point about what are the trends across countries and over time as incomes change and as global prices affect choices. And I do appreciate what you're saying about those of us in, say a country like the United States, where we may be able to absorb some of the shocks that may happen with food prices, we also recognize that there are folks from lower income households where those kinds of price shocks can be really challenging.

That's true.

But this is a different story when we're then talking about developing countries and some of the challenges that they face. Thank you for sharing that. I'm also interested in understanding what do economists mean by a nutritious and sustainable food demand, especially in the context of global or cross-country comparisons. What are some of the things that you uncovered in this review?

Yes, and I think the main thing, which is particularly interesting, is how early diets transition. How quick countries go from being staple dependent to sort of relying more on protein in consumption and demand. And that happens pretty early and so long before you get to say, countries like the United States with a per capita income of around $50,000 per person, you start seeing transitions quite early, right? Whereas income goes from say less than a $1,000 per person to maybe $5,000 and $10,000, you see these transitions right away. And in fact, you begin to see things level off. And what that means is when we think about, for example, animal protein production, which is in the context of dairy and beef, which is considered relatively more harmful to the environment than say poultry production. What you do find is that in these developing countries, they really do transition right away to meat with just minimal income growth. Whereas at the same time, when you start seeing income growth at the higher end of the spectrum, you don't see that much of a change. Now, something that's also unfortunate, what you find is that with income growth, you do see decrease in consumption of vegetables. A part of that is that some staples are counted as vegetables, but another part of that is that wealth and influence doesn't necessarily lead to improved diets. And that's something that's unfortunate. And what it says is that interventions are possibly needed for these improved diets. But to really get back to your question, this idea when we say sort of a nutritious diet, obviously we're thinking about diets that satisfy the nutritional needs of individuals. While at the same time mitigating unhealthy outcomes. Mitigating obesity, cardiovascular disease, etc. But then coupled with that is this whole notion of sustainable agricultural production. And I think one of the difficult things about both nutritious and abundant food as well as environmental outcomes, is we really are thinking about sort of trade-offs and complementarities. Then I think economics gives us a real keen insight into how these things play out.

Andrew, you make me worry that we're locked in. That is as soon as income start to rise, people move to more animal protein-based products. They move away from some fruits and vegetables. And knowing that the environmental consequences of those choices and even the health consequences, my question to you is what kinds of interventions or how do you think about interventions as a way to shape that demand? Is that an appropriate way to think about this?

Alright, so there's a few things. One is just sort of provide nutrition education globally. Having countries and their governments sort of understand these outcomes and then making a concerted effort to educate the public. The other thing is what you often do see is incentivized, for example, fish consumption. Incentivizing poultry production. And you do actually see a lot of incentives for poultry and egg consumption. And I think of like the Gates Foundation in that One Egg a Day initiative to help with child stunting and child growth in the developing world. And so, they're clearly protein alternatives to bovine type products. And I have to be clear here. Like I'm only speaking about this in the context of what's being said, in terms of the environment and animal production. But the other thing I think, it's probably even more important, right? Is this idea that we really do need to rethink how we, both in the developing world as well as in the developed world, rethink how we think about nutrition and eating. And that's just not for developing countries. That's for all countries. And obviously there's one last thing I'll highlight. You do have to be sort of concerned about, say something like taxes. Which would be clearly regressive in the developing world, and probably much more harmful to overall consumer welfare. The point is that taxes and subsidies seem to be the policy instruments of choice.

Great. Thank you for that. Andrew has just shared with us some of the issues of what happens as incomes rise and the changing patterns of behavior. And that there are some implications for sustainable diets. Emiliano, how can we use the type of data that, Andrew talked about to model food systems in terms of health and nutrition. What can we learn from these models and, what should we do with them?

Emiliano – Yes, thank you. Andrew really pointed to like many very important issues, aspects. We see some worrisome trends in the sense that current diets are going in the direction of showing less nutritious. Also, we are looking at a lot of issues in the environmental externalities, embedded resources. A lot of that within the current diet trajectory. Economic models, they have this advantage that they can connect these things together,...