Obamacare’s menu labeling scheme won’t work 

Among the many proposals under heated debate between the House and Senate health care bills is one provision both sides will likely support: A national law mandating calorie labels on chain restaurant menus and vending machines.

Advocates have described the measure as a symbolically important step against obesity and have spun recent research in their favor, but a closer look reveals a weak case for labeling.

A recent Stanford University study mines massive amounts of information provided by Starbucks to compare the effects of calorie labeling in New York City to control markets in Philadelphia and Boston. The study finds that consumers in New York reduced their calories by an average of 6 percent per transaction. That’s good news, but does it translate to a meaningful health outcome?

Even under the optimistic assumptions that similar reductions would occur at other restaurants and that consumers would not offset reductions at other meals, the authors note that actual weight loss may be slight. Their back-of-the-envelope model predicts that such an average reduction would “decrease long-run body weight by no more than 1 percent.”

They are quick to point out that actual savings could be greater. Consumers who currently eat the most also may reduce the most, and customers at other chains may be more responsive than those at Starbucks. Or, perhaps the opposite is true and the clientele of Starbucks is more responsive than customers at other chains.

That was the finding of the first major study of New York’s menu labeling law, which tracked purchases at four fast food chains in high-obesity neighborhoods. Though customers claimed calorie postings informed their decisions, consumption actually increased slightly after the labeling law took effect.

Critics of labeling point out that even consumers who reduce their consumption at the point of sale may end up eating more at other times. They may eat less at lunch and then, as a reward for their virtue, feel entitled to ice cream after dinner. The result is that total calorie intake remains unchanged.

A recent Yale University study found this is exactly what occurred among some of its test subjects. The addition of a menu statement advising them to consume no more than 2,000 calories per day did reduce total consumption, but it remains to be seen whether this finding would hold outside the contrived experimental environment in which the menus were presented.

It’s debatable whether the uncertain gains from calorie labeling would justify the costs of complying with new regulations. Fortunately, the alternative to mandatory labeling is not leaving customers in the dark.

Many large chains already publish nutritional information online and in in-store materials. And as Americans become more calorie-conscious, many chains have made a point to highlight their healthier options.

Making information available to those who want it doesn’t require plastering it all over the menu. If labeling doesn’t work as a nudge to make people eat better, why insist on such prominent disclosure?

Given the weak results found so far, Congress should refrain from imposing menu labeling nationwide. If significant results do develop in the jurisdictions that require labeling, we can reconsider. If they don’t, the rest of the country won’t have to comply with what turns out to be a purely symbolic measure.

Jacob Grier is a freelance writer in Portland, Ore. He writes the blog Liquidity Preference at www.jacobgrier.com.

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Jacob Grier

Jacob Grier is a writer based in Portland, Oregon. He authors the drink and policy weblog Liquidity Preference.
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