Take off the heater: Utility effect and food environment effect in food consumption decisions

In this paper, we describe individual food consumption decisions as driven by a utility effect and a food environment effect. To outline the utility effect, we first develop a new theoretical model of individual food consumption. Next, we introduce the food environment effect by showing how the food environment can affect food consumption decisions and how this can skew the resulting food consumption vector. Finally, we analyse manipulations of the food environment as a potential form of policy intervention. Our key result is that the food environment has several entry points in food consumption decisions and that libertarian paternalistic manipulations of the food environment can be effective, easily implemented, well-accepted and low-cost intervention options to nudge individuals towards healthier food consumption. Thus, a first step in interventions meant to improve diets should always be to attend to the food environment: at the very least to “take off the heater” and ensure that the food environment does not inadvertently guide food consumption decisions in an undesirable direction.