Study challenges idea policy drives caloric consumption

by Josh Sosland
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WASHINGTON — The effects of farm subsidies, when paired with the impact of other agricultural policies that restrict supply, are minimal on the number of calories consumed by an average American adult.

That is the conclusion of researchers from the Economic Research Service of the U.S. Department of Agriculture, the University of California at Davis and Cornell University.

A summary of their findings was published in the December 2012 issue of Amber Waves magazine, published by the E.R.S. The summary was written by Abigail M. Okrent, an E.R.S. researcher who was one of the study’s authors.

Ms. Okrent said the findings contradict an oft repeated line of reasoning.

“Many observers — including prominent economists, nutritionists, journalists and elected officials — speculate that agricultural policies contributed to increased U.S. obesity rates by making certain farm commodities more abundant and therefore cheaper,” she said. “They claim that farm program subsidies that lower prices for corn and wheat result in greater consumption of fattening foods and growing waistlines.”

To test this hypothesis, the researchers used a model to simulate the effects on consumption of a hypothetical removal of subsidies on food grains and oilseeds in 1992, 1997 and 2002.

“The model estimated changes in consumption of seven food groups, away-from-home foods, and alcoholic beverages,” she said. “Results show that removal of subsidies would lead to a decrease in production of food grains and oilseeds and an increase in prices for these commodities. However, given how small a share agricultural commodities contribute to food costs, especially for more highly processed products, price increases for the various food groups would be minimal.”

The researchers estimated elimination of the subsidies would lead to a decrease of 1,000 to 1,800 calories per year, contributing to weight loss of between a third and half a lb over a five-year period.

Bakery and cereal consumption would decline most steeply, according to the researchers, while dairy and fruit/vegetable consumption would increase the most, she said.

“Researchers also estimated changes in food consumption in the three time periods in response to removing all U.S. farm program subsidies, including subsidies for fish and aquaculture, and indirect subsidies provided by trade barriers that apply to U.S. imports of fruit, vegetables, sugar, and dairy products,” Ms. Okrent said. “Model results show that removing all agricultural subsidies would result in decreases in consumption of six of the nine food categories, but these declines were not enough to offset increases in consumption of dairy products, fruit and vegetables, and food away from home. Thus, with all subsidies removed, total caloric intake would increase between 3,100 and 3,900 calories per capita annually, or about 1 lb in body weight over a 5-year period.”

Other authors of the study, which was published in Health Economics, were Bradley Rickard, an assistant professor in the Charles H. Dyson School of Applied Economics and Management at Cornell, and Julian Alston, professor in the Department of Agricultural and Resource Economics at U.C. Davis.
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