title: Market Competition and the Health Composition of Manufactured Food.
abstract: There has been surprisingly little research to date on the supply-side role of food manufacturers on equilibrium health outcomes for consumers. In this letter we consider an oligopoly model in which food processors choose the health composition of manufactured food. We show that price competition between food processors leads to unhealthy food composition in the market equilibrium, even under circumstances in which consumers know food composition is unhealthy. Taxes on manufactured food decrease the healthiness of manufactured foods whenever improved consumer health increases the price elasticity of food demand. Copyright © 2016 John Wiley & Sons, Ltd.
authors.affiliation: California Polytechnic State University, San Luis Obispo, CA, USA.
authors.forename: Stephen F
authors.initials: SF
authors.lastname: Hamilton
authors.affiliation: Toulouse School of Economics, INRA, University of Toulouse Capitole, Toulouse, France.
authors.forename: Vincent
authors.initials: V
authors.lastname: Réquillart
mesh_terms: D000465:Algorithms; D004465:Economic Competition; D019649:Food Industry; D009753:Nutritive Value; D000075485:Population Health; D011640:Public Policy; D013660:Taxes
keywords: consumer health; food design; manufactured food; nutritional policies