« Should US Taxes on Gasoline be Higher? Becker | Main | Compelled Disclosure of Food Characteristics--Posner »

07/27/2008

TrackBack

TrackBack URL for this entry:
http://www.typepad.com/services/trackback/6a00d8341c031153ef013482fedee2970c

Listed below are links to weblogs that reference Is Government Intervention in the Fast Food Industry Justified? Becker:

» The war on obesity - in Brazil from PSD Blog - World Bank Group
Brazilians have earned a reputation around the world for their beauty, boosted by fashion icons like Gisele Bündchen. But a recent article from the Science and Development Network sounded an alarm about the state of things in Brazil. Jonathan Wells, a... [Read More]

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

jonm

You say that "Requiring restaurants to post calorie content of foods will have a negligible effect on demand for these foods", and since the cost is negligible, presumably you don't really object to this regulation.

I, on the other hand, observe that lots of people are very very far from being rational intertemporal optimizers and instead find there is a painful trade off between buying tasty fattening food in the short term and regretting the pounds on the waist-line in the long term. Further, I think that almost no one will object to seeing the information while a significant number will reduce their overconsumption, increasing their long-term happiness, so we might as well implement this one, as you don't really seem to object.

The trade-off between short term and long term goals is also consistent with posting the information being sub-optimal for any one restaurant chain, but being socially optimal.

Mike Liceright

Let's assume that there is a chemical "TFT"
that will kill 1% of the people who eat it
a year early, but that it will preserve the
food so that the cost to the fast food
restaurant of not using it is $0.01 per
serving.

Is it your contention that it is the responsibility of
the customer to get a signed contract with
the restaurant that they are not using "TFT"
and that any involvement of the Government
is too much interference, or is the amount
of government involvement in the use of
"Trans FaT" dependent on the risks and costs,
as far as whether there should Government
required, 1) Notifications, 2) Warnings,
3) Taxes, or 4) Outright bans?,
and in the
case of Trans FaT, the Risks/Cost are low
enough that the We, the Citizens, should
not, or Must not, interfear with the Free
Enterprise system.

dWj

You seem not quite to come out and explicitly note that the government, in other ways, is subsidizing poor people eating at these restaurants. Some kind of tax or restriction on them eating at these restaurants is a correction of a previous error.

Still, it seems the easiest way to make people pay the costs of their health care decisions would be to make people pay the costs of their health care.

It may well be that better nutritional information will be of little interest to consumers, though it may well not be the case, either. As long as the costs of providing this information are low, I tend to support a better-informed consumer. I certainly think posting statistics on trans-fats and providing information on the trans-fat content of food is a far less onerous combination of regulations than simply banning it outright, insisting that no consumer is competent to decide that the benefit is greater than the cost.

Richard

Becker makes an excellent point about the tendency to propose big-government "solutions" to problems that were caused by big government in the first place. It happens all the time. Politicians should pay much closer attention to the law of unintended effects, before they adopt new programs and/or requirements.

Thomason

The regulatory issue is less about the supporting logic and more about: does it work; do lists of nutrients or the banning of transfats give actual results? If there's a disconnect between the theory and the result, then toss both. Some hate regulation, others advocate self-determination, but again, it's not about personal philosophy.
The banning of transfats will have an immeasurable effect on obesity or health problems related to it. No, transfats are not good, and probably are bad, for you nutritionally - but, banning them will not reduce consumption of a million other products that can lead to obesity and related health issues. So too with nutritional information - consumers cannot accurately interpret it. Thus, they can read every label on every foodstuff, but only through the exercise of self-control will they have nutritional health. That self-control works as well even if you have no idea what's "in" food products. Knowing the nutritional components of stuffing smothered with gravy adds little to a near-innate understanding that these foods will fatten me.
Pointless regulation is the evil, not those changes that actually promote healthful changes.

neilehat

"Is Government intervention in the Fast Food Industry justified?" Let's extrapolate this question out and see, "Is Government intervention in the Food Industry justified?" and again, "Is Government intervention in Industry justified?"

If one does an historical and economic analysis of any of the questions, one will find that the answer is a resounding "YES"!

david

while it's true that calorie info and banning trans fats won't reduce the demand for fast food generally they may help those who do eat at such places make better choices while they are there--letting people know how unhealthy 32 oz of coke are may lead someone to choose water or diet soda instead--thereby saving hundreds of calories

Anonymous

The issue seems much larger than just banning or limiting the number of "fast food" units in an area or insisting that they divulge what they are putting in their "food", but the whole model that has made them ubiquitous.

They've fine-tuned their model of profiting from cheap food and soft drinks combined with such low wages that among the "externalities" we might discuss is that of taxpayers subsidizing the difference between what the employees get in their paycheck and what the cost of a minimum existence costs.

Using this formula for 50 years they've frozen out other types of cafes. These would include the "Mom's" cafes and those catering to "merchant lunches" and diners where fairly wholesome "home cooked" food could be obtained even before the, moms going to work too, movement created such a huge market for eating out, or on the run.

Again, in a functioning democracy? there is more to the story than simply that of "the market" and as a community of human beings first and "economic units" or consumers for giant corporate interests, it is a part of our ongoing educational function to inform folks about the nature of the food they are putting in the only body they'll ever have.

BTW a tip of the hat to the many new immigrant or ethnic cafes that by dint of tremendous labor have been able to survive and provide a locally owned, tastier, and most likely far healthier alternative to the corporate juggernaut.

David Heigham

Forgetting is such sweet oblivion; however, I cannot help remebering noting more than half a century ago that the food served by MacDonald's and by Burger King was considerably healthier than that offered by most of their then competitors. I have also recently confirmed that MacDonald's and Burger King now serve healthier food than they did then.
(The Economist's Big Mac index is of relative prices between markets, so the upward quality creep at MacDonald's does not affect it.)

Recently the idea of policy "Nudge" to change behaviour has become deservedly fashionable. I suspect that this New York legislation will soon be quoted as an example of how not to nudge. For the target groups, the increased information noise is likely to swamp the message. However, done sensibly, nudging as an approach to reducing behaviour which imposes externalities on others is surely right. and entirely proper.

Regulating out of a market a substance or activity which has been found to be subtly harmful is a regular public health function. Each case needs looking at on its merits, but transfats seem to have few advantags to offset the case against them. However, regulating them out of only a part of a market seems very strange.

Gonzalo Edwards

One issue that should be addressed is the issue of "attention diversion". The more information one is exposed to about what not to eat or about the number of calories of different foods, the less attention one is able to pay to adds on the importance of not smoking; of not eating salt; of regular check-ups for early detection of many diseases; of not using the car for pollution or climate-change reasons; of the importance of sun blockers to avoid UV radiation, etc.

Gazi Islam

Although both Posner and Becker framed their arguments in terms of government intervention vs letting the market take care of itself, I think there are 2 big counterarguments to such a framing:

1. Much of the fast food industry is SUBSIDIZED by the government through the agricultural subsidies on their ingredients. Things like corn (corn syrup) and industrial beef are heavily protected from markets, and such ingredients are differentially present in fast food vs slow food. Actually letting the market truly take care of itself would hurt fast food much more than simply putting warning lables.

2. Related to Becker's analogy about the limitation of children because they result in externalities, I think a distinction should be drawn on interventions which force or prohibit action (i.e. no more babies) and those which force disclosure. Fast food already makes fatty Big Macs, but would only be complelled to admit it under the new law. If efficient markets presuppose full information, then greater information disclosure should help consumer choice. The restaurants would only be forced to be transparent about their actions/products.

neilehat

Gazi-Islam, Is this another feeble attempt by you guys to undermine Western Industry, specifically American Agri-Business, by calling it "SUBSIDIZED". Of course it is and so it shall remain. If you don't like it and can't compete, get out of the Market. That's the game.

As for more information increasing the efficiency of the market place by creating more and better informed consumers, there is a phenomenon that occurs in Communications Theory called "Information Overload" that occurs and leads to just the opposite effect - producing poorly and less informed individuals. So much for greater efficiency and a rational market place by providing more and more information.

Jack

Neil: Would one response to the problem of info overload be that of doing more regulating and reducing more of the worst pitfalls?

neilehat

Jack, Sounds good to me. As long as we handle it on an "as needed" case by case basis. No matter how much the world is painted as a ""warm" "fuzzy" and "friendly" place where all can live their "fantasy"", it is still populated with many liars, cheats, theives, frauds, and scroundels using the smokescreen of the globalists con job to mask their many crimes.

Anonymous

thanks you ar
بنت مكه

Anonymous

مركز تحميل

Anonymous

thanks
بنت الزلفي

Anonymous

Thank you, you always get to all new and used it
شات صوتي

Anonymous

great post,and you will lovetiffanys,
tiffany

Anonymous

Greeting. The only difference between a rut and a grave... is in their dimensions.
I am from Timor and , too, and now am writing in English, tell me right I wrote the following sentence: "Renters insurance things to consider."

Waiting for a reply :-), Marli.

Anonymous

Thank you, you always get to all new and used it
ÿ¥ÿßÿ™

ÿØÿ±ÿØÿ¥ÿ©

Anonymous

شات سعودي
00
دردشة سعودي

Anonymous

ÿ¥ÿßÿ™ ŸÖÿµÿ±
--
دردشة مصرية

Anonymous

8gaUfH

Anonymous

ÿØÿ±ÿØÿ¥ÿ©
___
صور

The comments to this entry are closed.

Become a Fan

May 2014

Sun Mon Tue Wed Thu Fri Sat
        1 2 3
4 5 6 7 8 9 10
11 12 13 14 15 16 17
18 19 20 21 22 23 24
25 26 27 28 29 30 31