Improving Nutritional Quality of Consumers’ Food Purchases With Traffic-Lights Labels: An Experimental Analysis

Abstract

A laboratory experiment was conducted in France to evaluate the role of colour-coded traffic lights (TLs) in signalling the nutritional quality of food. The experimental protocol focused on participants’ willingness-to-pay (WTP) for breakfast cereals, and it precisely identified the impact of both TL appearance and additional explanations about these TLs. The results of this paper show a significant influence of both TL appearance and additional explanations on consumers’ WTP. Regarding the TL appearance, the red colour associated with a low nutritional quality of foods has a sustained impact compared to the impact of the green and yellow colours. In other words, the placement of TLs on all products mainly leads to a reduction in WTP for products with the red colour, although WTP for other products with the green or yellow colours also changes. Additional explanations about TLs and nutrition also matter because they significantly influence WTP. Based on the participants’ WTP, we estimate the welfare impact of mandatory TLs, suggesting that it would be socially optimal to introduce these mandatory TLs with additional explanations.