Quotulatiousness

December 26, 2017

QotD: Most consumers say they want local-grown food, but won’t pay the costs to get it

Filed under: Business, Quotations, USA — Tags: , , , — Nicholas @ 01:00

Food grown locally, on small-lot farms without modern chemical assistance, is really expensive. The complex modern food-supply chain that ensures restaurants and food processors can get the same consistent mix of staple ingredients year-round also relentlessly beats down the price of food, sourcing wherever supply is cheapest, redistributing temporary local abundance to a steady global diet of everyday low prices. This is also not such a terrible way to eat; it is the foundation of much of our modern prosperity. But it is not local, artisanal, organic. It is global, industrial, indifferent. It has to be, both because organic inputs are much more expensive, and because trying to separate and track all the food so that restaurateurs can be sure of provenance and process would mean abandoning many of the efficiencies that make the stuff so cheap.

And Americans expect cheap. Cheap, after all, is what makes it possible for us to spend so much money at restaurants; if we had to pay all the workers $20 an hour and ensure that all our meat and produce had been farmed in the latest and most approved 19th-century methods, few of us could afford to have weekly dining out in our budget. Restaurants might be more authentic, delicious, moral places. They would also be much emptier ones.

Reading the Tampa Bay Times article, you get the sense that many of these restaurateurs tried to provide an authentic farm-to-table experience and found that customers were not willing to pay what it would cost — in money or variety — to have one. People are probably willing to pay some premium for that kind of food, but the premium is probably closer to 10 to 15 percent than it is to the sky-high sums that it would actually cost to rely on those sorts of farms, those sorts of methods. So the restaurateurs inevitably sold them what they were happily willing to pay for: food from an industrial supply chain, with a side of moral satisfaction.

It’s hard to be too angry at consumers. To be sure, they probably should have known that you couldn’t really buy organic, locally sourced food year-round at just a smidge more than you’d pay for a regular meal. After all, the average American spent half their income on food in 1900, while the modern American now spends a paltry 12 percent, even including a lavish helping of restaurant meals. That should give us some sign that local, artisanal food is not going to be cheap. But most Americans are not economic historians.

But it’s not even that easy to be mad at the restaurants. They’re in a viciously competitive business where most places don’t survive. In a competitive equilibrium where so many people want to be told they’re eating farm-fresh food — and so few people seem willing to pay for it — many of them probably feel that their choice is “lie or die.”

Megan McArdle, “Dining Out on Empty Virtue”, Bloomberg View, 2016-04-15.

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