Abstract
This study addresses the trade-off between nutrition and taste in expenditure on breakfast cereal, milk, bread, and soft drinks. Within each category, products have similar cost and convenience, but have markedly different flavor and nutritional content. Using annual expenditure data for a large sample of households participating in the ACNielsen Homescan system, we regress a measure of “healthiness” on household demographics and market prices, and find that households with college-educated heads and higher incomes made significantly healthier choices in all four categories. These effects are puzzling in that the nutritional differences between products were well known to consumers, and there are no cost or convenience differences between them. The presence of children was associated with less healthy choices, especially for cereal and bread, while older households made healthier choices in all categories except milk.
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