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Do nutrition labels improve dietary outcomes?

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  • Jayachandran N. Variyam

    (Economic Research Service, US Department of Agriculture, Washington, DC, USA)

Abstract

The disclosure of nutritional characteristics of most packaged foods became mandatory in the United States with the implementation of the Nutrition Labeling and Education Act (NLEA) in 1994. Under the NLEA regulations, a 'Nutrition Facts' panel displays information on nutrients such as calories, total and saturated fats, cholesterol, and sodium in a standardized format. By providing nutrition information in a credible, distinctive, and easy-to-read format, the new label was expected to help consumers choose healthier, more nutritious diets. This paper examines whether the disclosure of nutrition information through the mandatory labels impacted consumer diets. Assessing the dietary effects of labeling is problematic due to the confounding of the label effect with unobserved label user characteristics. This self-selection problem is addressed by exploiting the fact that the NLEA exempts away-from-home foods from mandatory labeling. Difference-in-differences models that account for zero away-from-home intakes suggest that the labels increase fiber and iron intakes of label users compared with label nonusers. In comparison, a model that does not account for self-selection implies significant label effects for all but two of the 13 nutrients that are listed on the label. Published in 2007 by John Wiley & Sons, Ltd.

Suggested Citation

  • Jayachandran N. Variyam, 2008. "Do nutrition labels improve dietary outcomes?," Health Economics, John Wiley & Sons, Ltd., vol. 17(6), pages 695-708.
  • Handle: RePEc:wly:hlthec:v:17:y:2008:i:6:p:695-708
    DOI: 10.1002/hec.1287
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    File URL: http://hdl.handle.net/10.1002/hec.1287
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    References listed on IDEAS

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    1. Mathios, Alan D, 2000. "The Impact of Mandatory Disclosure Laws on Product Choices: An Analysis of the Salad Dressing Market," Journal of Law and Economics, University of Chicago Press, vol. 43(2), pages 651-677, October.
    2. Kim, Sung-Yong & Nayga, Rodolfo M., Jr. & Capps, Oral, Jr., 2000. "The Effect Of Food Label Use On Nutrient Intakes: An Endogenous Switching Regression Analysis," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 25(01), July.
    3. repec:aph:ajpbhl:1993:83:5:717-724_1 is not listed on IDEAS
    4. Variyam, Jayachandran N., 2005. "Nutrition Labeling in the Food-Away-From-Home Sector: An Economic Assessment," Economic Research Report 7235, United States Department of Agriculture, Economic Research Service.
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