Recently I was reading an article, "The big Washington food fight" in Politico discussing challenges of bringing diverse interests and perspectives on food issues under one roof through the Grocery Manufacturers Association.
There are a couple things influencing my thinking about this. One is the idea that voters and consumers may have systemic biases in their knowledge and preferences in general and specifically about food and technology. The other thing is related to recent research showing a divergence between public perceptions and science driven by political leaning....a divergence that widens *with* more education and science knowledge (see http://www.pnas.org/content/114/36/9587 ).
So in this context, what does it mean to say 'the customer is always right' and how do you give the customer what they want, but do it with integrity? There seem to be two dominant approaches or paradigms followed by food companies for dealing with this.
One approach is going all in with 'negative' advertising or 'free from' labeling regardless of scientific justification. This paradigm feigns or fakes transparency in the sense it acknowledges consumer preferences related to knowing 'what is in their food' but adds lots of confusion about substantial differences related to food safety and sustainability. The other paradigm takes a 'less is more' approach in terms of honest disclosure about these technologies.
A more generous interpretation of the first behavior is that these food retailers and manufacturers are cognizant of consumer preferences, and assume great deal of consumer ignorance. Take for instance consumers attempting to avoid gluten (reasons why merit a separate discussion). Retailers may assume consumers are extremely ignorant of the fact that gluten originates from wheat based ingredients. A number of food products (like apples, raisins, ground beef, potatoes, carrots etc.) generally would not possibly contain gluten unless they were highly processed or prepared using some wheat based ingredient. As an extreme example for illustrative purposes, we might imagine an uninformed consumer choosing between a bag of carrots and a loaf of bread. A manufacturer would feel they are helping the consumer simplify the decision by adding a 'gluten free' label to the bag of carrots. Additionally, if competitor brands don't have the label, they may risk losing a sale to the 'gluten free' labeled product if a large enough number of uninformed consumers are trying to avoid gluten. We end up with a Nash equilibrium strategy to employ 'free from'labels that really make no sense from a nutritional or scientific standpoint. Gluten is just one example, the logic easily carries over to a number of food products and ingredients (i.e. free-from labels related to added hormones in pork and poultry, GMO free tomatoes etc.)
Helping consumers avoid what they *think* or *perceive* to be harmful to themselves or the environment using this strategy may help increase or defend sales, but it does very little to truly educate consumers about food choices. It likely perpetuates ignorance and myths about food, nutrition, health, and sustainability. Worse, in some cases it may directly or indirectly lead to consumers actually choosing marginally less healthy or less sustainable products or technologies either directly or indirectly because of decreased viability of marketing alternatively sustainable foods (i.e. the loss of rBST from the milk supply).
Whichever paradigm becomes the most dominant (both in the marketplace and the ballot box) may ultimately influence the types of products we see on the shelves and reduce the potential for healthier and more environmentally sustainable solutions to challenging worldwide problems. Efforts to escape this less than optimal Nash equilibrium position could include restrictions limiting free from labels to only non-obvious food products but I am not sure this is a viable solution.
Sometimes people devise cooperative ways to escape from a Nash equilibrium without resorting to taxes or regulation. Nobel prize winning economist Elinor Ostrom's work speaks to this:
"Predictions that individuals will not devise, precommit to, and monitor their own rules to change the structure of interdependent situations so as to obtain joint benefits are not consistent with evidence that some individuals have overcome these problems, although others have not." - Governing the Commons: The Evolution of Institutions for Collective Action. By Elinor Ostrom
But how would this work? The recent backlash by the scientific community regarding StonyField Organic's portrayal of young girls in a Facebook video and the Peel Back the Label movement are two examples of social harassment costs or other monitoring behaviors within the industry that may give some hope. Will this continue or become a large enough force for change?
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