Price Interventions Research Articles

Agricultural Transformation, Nutrition Transition and Food Policy in Africa: Preston Curves Reveal New Stylised Facts

This paper uses a Preston Curve approach to test for changes over time in agriculture, nutrition and food policy, comparing national averages in Africa and elsewhere at each level of national income per capita from the 1990s to the 2010s. Our statistical tests and data visualisations reveal that, at each level of income, African countries have faster rural population growth, a larger share of workers in agriculture and lower agricultural labour productivity than countries elsewhere, with no significant shift in these patterns from the 1990s to the 2010s. In contrast, there have been structural shifts towards less child stunting everywhere, and towards more adult obesity in high-income countries. The overall pattern of African governments’ food policies and government expenditures have not shifted, however, as they continue price interventions and low investment levels characteristic of low-income countries around the world.

The effect on emergency department visits of raised alcohol minimum prices in Saskatchewan, Canada

The province of Saskatchewan, Canada introduced minimum prices graded by alcohol strength in April 2010. As previous research found this intervention significantly decreased alcohol consumption and alcohol-attributable morbidity, we aim to test the association between the intervention and the rate of emergency department (ED) visits in four alcohol-related injury categories [motor vehicle collisions (MVC), assaults, falls and total alcohol-related injuries]. Data on ED visits in the city of Regina were obtained from the Saskatchewan Ministry of Health. Auto-regressive integrated moving average time series models were used to test the immediate and lagged effects of the pricing intervention on rates of alcohol-related nighttime. ED visits and controlled for daytime rates of ED visits, economic variables, linear and seasonal trends, and auto-regressive and moving average effects. The implementation of an alcohol minimum pricing strategy in Saskatchewan was associated with decreased MVC-related ED visits for women aged 26 and over after a 6 month lag period (-39.4%, P < 0.001). There was no significant abrupt effect of this intervention on ED visits of four injury types in any of four gender-age categories; however, rates of ED visits among young males for MVCs and assaults decreased substantially during this study. The minimum pricing policy change led to a lagged decrease in motor vehicle-collision-related ED visits for women older than 25. Of note, there did not appear to be an instantaneous effect on the rate of alcohol-related injury ED visits immediately after the policy implementation nor lagged effects for other gender-age groups.

Identifying Financially Sustainable Pricing Interventions to Promote Healthier Beverage Purchases in Small Neighborhood Stores.

IntroductionResidents of low-income communities often purchase sugar-sweetened beverages (SSBs) at small, neighborhood “corner” stores. Lowering water prices and increasing SSB prices are potentially complementary public health strategies to promote more healthful beverage purchasing patterns in these stores. Sustainability, however, depends on financial feasibility. Because in-store pricing experiments are complex and require retailers to take business risks, we used a simulation approach to identify profitable pricing combinations for corner stores.MethodsThe analytic approach was based on inventory models, which are suitable for modeling business operations. We used discrete-event simulation to build inventory models that use data representing beverage inventory, wholesale costs, changes in retail prices, and consumer demand for 2 corner stores in Baltimore, Maryland. Model outputs yielded ranges for water and SSB prices that increased water demand without loss of profit from combined water and SSB sales.ResultsA 20% SSB price increase allowed lowering water prices by up to 20% while maintaining profit and increased water demand by 9% and 14%, for stores selling SSBs in 12-oz cans and 16- to 20-oz bottles, respectively. Without changing water prices, profits could increase by 4% and 6%, respectively. Sensitivity analysis showed that stores with a higher volume of SSB sales could reduce water prices the most without loss of profit.ConclusionVarious combinations of SSB and water prices could encourage water consumption while maintaining or increasing store owners’ profits. This model is a first step in designing and implementing profitable pricing strategies in collaboration with store owners.

Paddy prices and marketing agencies in India: an empirical analysis of effectiveness of public procurement

Ensuring remunerative prices to farmers through price and non-price interventions by the government is an essential component of sustainable development of agriculture in India. This paper identifies market and non-market factors responsible for higher price realisation by farmers over the government-determined minimum support price (MSP). Our findings show that small and marginal farmers (with less than 2 hectares of land) in the states with low quantum of procurement are more likely to sell below MSP to local private traders. However, the probability of receiving higher prices increases if they shift from private traders to wholesale markets (mandis) and government agencies, and this is much higher in states with higher levels of procurement. The probability of better price realization also improves with increase in land size and access to institutional credit.

Thomas Bayes Goes to the Virtual Supermarket: Combining Prior Food Price Elasticities and Experimental Data in a Large Demand System of Dietary Choices

Food price elasticities (PE) are essential for evaluating impacts of food pricing interventions. Existing econometric estimates of food PEs are often poor, being based on single observational data sets without much variation in prices and failing to utilise prior information. In order to provide better PE estimates for policy analysis, this paper innovates the use of experimental purchasing data from a recent virtual supermarket experiment to estimate the PE matrix for a large set of foods via a Linear Almost Ideal Demand System (AIDS) and proposes an approach to incorporate PE results from observational data studies in the empirical results within a Bayesian estimation framework. We combine a multi-stage Bayesian approach to estimate a set of demand systems using the Edgerton approach to aggregate elasticities to obtain Marshallian and Hicksian PE matrices for a total of 23 food groups.

Responding to a Groundwater Crisis: The Effects of Self-Imposed Economic Incentives

Many globally important groundwater aquifers are under considerable stress as withdrawals, predominantly for irrigation, outpace recharge. Meanwhile, groundwater policy to address the common-pool resource losses remains in its nascent stage. This study analyzes a recent and unique bottom-up effort to self-impose a groundwater pumping fee in San Luis Valley, Colorado. Utilizing a difference-in-difference econometric framework, our results bring new and direct empirical evidence to the debate on the use of economic incentives in groundwater policy. We find that the price intervention has been effective, leading to a 33% reduction in groundwater use, predominantly through reduced irrigation intensity. We also find, to a more limited extent, movement away from water-thirsty crops and reduced overall irrigated acreage. Given that financial incentives can produce substantial conservation within a groundwater commons in duress, price-based policies warrant further consideration as irrigators address diminishing and variable water supplies.

The potential impact of food taxes and subsidies on cardiovascular disease and diabetes burden and disparities in the United States

BackgroundFiscal interventions are promising strategies to improve diets, reduce cardiovascular disease and diabetes (cardiometabolic diseases; CMD), and address health disparities. The aim of this study is to estimate the impact of specific dietary taxes and subsidies on CMD deaths and disparities in the US.MethodsUsing nationally representative data, we used a comparative risk assessment to model the potential effects on total CMD deaths and disparities of price subsidies (10%, 30%) on fruits, vegetables, whole grains, and nuts/seeds and taxes (10%, 30%) on processed meat, unprocessed red meats, and sugar-sweetened beverages. We modeled two gradients of price-responsiveness by education, an indicator of socioeconomic status (SES), based on global price elasticities (18% greater price-responsiveness in low vs. high SES) and recent national experiences with taxes on sugar-sweetened beverages (65% greater price-responsiveness in low vs. high SES).ResultsEach price intervention would reduce CMD deaths. Overall, the largest proportional reductions were seen in stroke, followed by diabetes and coronary heart disease. Jointly altering prices of all seven dietary factors (10% each, with 18% greater price-responsiveness by SES) would prevent 23,174 (95% UI 22,024–24,595) CMD deaths/year, corresponding to 3.1% (95% UI 2.9–3.4) of CMD deaths among Americans with a lower than high school education, 3.6% (95% UI 3.3–3.8) among high school graduates/some college, and 2.9% (95% UI 2.7–3.5) among college graduates. Applying a 30% price change and larger price-responsiveness (65%) in low SES, the corresponding reductions were 10.9% (95% UI 9.2–10.8), 9.8% (95% UI 9.1–10.4), and 6.7% (95% UI 6.2–7.6). The latter scenario would reduce disparities in CMD between Americans with lower than high school versus a college education by 3.5 (95% UI 2.3–4.5) percentage points.ConclusionsModest taxes and subsidies for key dietary factors could meaningfully reduce CMD and improve US disparities.

Pricing Strategies to Encourage Availability, Purchase, and Consumption of Healthy Foods and Beverages: A Systematic Review.

IntroductionFood pricing policies to promote healthy diets, such as taxes, price manipulations, and food subsidies, have been tested in different settings. However, little consensus exists about the effect of these policies on the availability of healthy and unhealthy foods, on what foods consumers buy, or on the impact of food purchases on consumer health outcomes. We conducted a systematic review of studies of the effect of food-pricing interventions on retail sales and on consumer purchasing and consumption of healthy foods and beverages.MethodsWe used MEDLINE, Embase, PsycINFO, Web of Science, ClinicalTrials.gov, and the Cochrane Library to conduct a systematic search for peer-reviewed articles related to studies of food pricing policies. We selected articles that were published in English from January 2000 through December 2016 on the following types of studies: 1) real-world experimental studies (randomized controlled trials, quasi-experimental studies, and natural experiments); 2) population studies of people or retail stores in middle-income and high-income countries; 3) pricing interventions alone or in combination with other strategies (price promotions, coupons, taxes, or cash-back rebates), excluding studies of vending-machine or online sales; and 4) outcomes studies at the retail (stocking, sales) and consumer (purchasing, consumption) levels. We selected 65 articles representing 30 studies for review.ResultsSixteen pricing intervention studies that sought to improve access to healthy food and beverage options reported increased stocking and sales of promoted food items. Most studies (n = 23) reported improvement in the purchasing and consumption of healthy foods or beverages or decreased purchasing and consumption of unhealthy foods or beverages. Most studies assessed promotions of fresh fruits and vegetables (n = 20); however, these foods may be hard to source, have high perishability, and raise concerns about safety and handling. Few of the pricing studies we reviewed discouraged purchasing and consumption of unhealthy foods (n = 6). Many studies we reviewed had limitations, including lack of formative research, process evaluation, or psychosocial and health assessments of the intervention’s impact; short intervention duration; or no assessment of food substitutions or the effects of pricing interventions on food purchasing and diets.ConclusionPricing interventions generally increased stocking, sales, purchasing, and consumption of promoted foods and beverages. Additional studies are needed to differentiate the potential impact of selected pricing strategies and policies over others.

The Distinctive Competence Development at the Firm Solving Problems of Competitiveness in the Socioeconomic System

Competitiveness results from factors beyond structural conditions and organizational boundaries, such as cooperation. Evidence gathered in credit unions suggests there is a social process in the firm for generating capabilities and economic goods to satisfy the needs established by social structures in charge of resolving market failures and structural deficiencies in the productive system. An exploratory and descriptive multiple case study with longitudinal qualitative data supported by a computer-based Process Tracing method leads to the refinement of a mathematical model of social phenomenon based on a set of decision-making rules of deterministic nature. Two case studies reveal that the firms maintain relations of cooperation and contribution with partners and social structures in their organizational and environmental surroundings every time their economic performance is constrained by competitive problems of systemic nature, for which there is no solution based on mechanisms of market price and state intervention.

Discriminating market segments using preferential green shift: a conjoint approach

PurposeThis paper aims to explore surprising facets of consumer delight behavior. The study is the empirical juncture of three studies based on consumer survey on the Indian television market. Study 1 traces the existence of greenies in India among brownies prevailing around the globe by using the surprise-delight model. Study 2 is a pre-intervention research design confirming greenies preferences to television attributes such as screen technology, annual energy cost saving, screen resolution, screen size and free gifts. Study 3 signifies a price intervention design by allowing customers to include their preference by replacing the annual energy cost saving with price.Design/methodology/approachThis paper is a harvest of studies based on discriminant analysis for identifying green and brown customers and a two-level conjoint analysis for identifying attributes contributing to green behavior.FindingsThe empirical generalization of a study comes out with unique findings of the greenies and brownies and their preference and attitude toward green attribution and substitution. A “preferential green shift” appeared as a vital output owing to knowledge–attitude–practice from these consecutive studies. This gap exists because of the price factor. The authors suggest the measures for improvement in product offering by targeting and positioning green products from the findings and the preferential green shift.Research limitations/implicationsFuture research may focus on other segments of products such as automobiles, i.e. cars. Despite the availability of the non-probabilistic sampling technique, the probabilistic sampling technique can be used. Finally, a larger sample size could have given a better generalization of results.Originality/valueThe gap in knowledge–attitude–practice was evident. This gap was caused by the presence of “price” concern. The study revealed that heavy consumer durable buyers are aware of the benefit of green, but the reality of price cannot be ignored and finally make a purchasing decision on the basis of price criteria. Hence price is recommended as another criterion to be considered in the technology acceptance models.

Regulating drinking through alcohol taxation and minimum unit pricing: A historical perspective on alcohol pricing interventions

AbstractDiscourse on alcohol policy in several countries has recently become dominated by discussions of pricing. In Britain, proposals for a minimum unit price for alcoholic drinks are frequently depicted as radical and new. However, other means of legally intervening in alcohol pricing have long been used to shape consumption habits. Key to recognizing this historical lineage is a conceptualization of taxation as partly a form of regulation. This article builds upon findings from a wider historical study of alcohol excise duties in England and Wales to develop an empirically‐based typology of the main forms of government interventions in alcohol pricing. By connecting some instances of alcohol excise taxation to government attempts to shape behavior, this typology enables advances in understanding of the relationship between taxation and regulation. In so doing, the article also provides an original historical perspective on an ongoing policy debate. © 2017 John Wiley &amp; Sons Australia, Ltd

Policy Analysis in Matching Markets

Price and quantity interventions intended to affect assignments are common in many labor and education markets (e.g., financial aid, quotas). This article discusses an empirical framework, based on the theory of stable matching, that is suitable for policy analysis while accounting for the presence of equilibrium sorting. It then compares financial incentives and supply interventions for encouraging the training of family medicine residents in rural America. Due to equilibrium effects, the primary effect of financial incentives is to increase the quality, not numbers, of residents in rural programs, while quantity regulations directly affect numbers without adversely affecting quality.

Testing price leadership in major regional maize markets in Ethiopia: implications for targeted market intervention

ABSTRACTThe central market hypothesis or price leadership role is an important concept of market integration, and it has relevant policy implications because it simplifies market price monitoring and intervention in the grain market. Knowledge about the presence of a central market and its price dynamic effects on satellite markets will assist the effectiveness of food assistance and other humanitarian food price support interventions. This is of particular interest to constant food aid recipients such as Ethiopia. This article intends to empirically investigate as to whether or not there is a central maize market that dictate and lead price information flow over the regional wholesale maize markets in Ethiopia. If such a dominant maize market exists, then how does its price affect the maize grain prices of major regional wholesale maize markets in Ethiopia? The extended VAR procedure of Toda and the Yamamoto Granger Causality approach is used to test the central maize market hypothesis. Furthermore, we use the system of seemingly unrelated regression model to examine the effects of the central market price on three wholesale regional maize market prices in Ethiopia. The results indicate that Addis Ababa wholesale maize market influences the maize price formation of all regional maize markets examined in this study. Therefore, interventions targeting the central wholesale market could successfully provide a buffer for local maize surplus and consumption markets against undesirable price shocks stemming from the central market.

How Does Urbanization Affect Balanced Growth in Urban and Rural Areas of China?

The relationship between urban and rural development in the process of urbanization is closely related to social stability. This paper presents a model to analyze the development of urban and rural economies in two different states, i.e. an isolated state and an interactive state. The analysis finds that urbanization promotes balanced urban and rural growth by mobilizing knowledge, labor and capital, while the government’s investment bias and price intervention intensify imbalance between urban and rural development in the isolated state and offset the promotion function of urbanization. Some empirical analyses using provincial-level panel data for China have verified the above conclusion. Therefore, the government should pay more attention to balancing its investment and reducing its price intervention in product markets as urbanization continues to be promoted.

Store-directed price promotions and communications strategies improve healthier food supply and demand: impact results from a randomized controlled, Baltimore City store-intervention trial.

ObjectiveSmall food store interventions show promise to increase healthy food access in under-resourced areas. However, none have tested the impact of price discounts on healthy food supply and demand. We tested the impact of store-directed price discounts and communications strategies, separately and combined, on the stocking, sales and prices of healthier foods and on storeowner psychosocial factors.DesignFactorial design randomized controlled trial.SettingTwenty-four corner stores in low-income neighbourhoods of Baltimore City, MD, USA.SubjectsStores were randomized to pricing intervention, communications intervention, combined pricing and communications intervention, or control. Stores that received the pricing intervention were given a 10–30% price discount by wholesalers on selected healthier food items during the 6-month trial. Communications stores received visual and interactive materials to promote healthy items, including signage, taste tests and refrigerators.ResultsAll interventions showed significantly increased stock of promoted foods υ. control. There was a significant treatment effect for daily unit sales of healthy snacks (β = 6·4, 95% CI 0·9, 11·9) and prices of healthy staple foods (β = −0·49, 95% CI −0·90, −0·03) for the combined group υ. control, but not for other intervention groups. There were no significant intervention effects on storeowner psychosocial factors.ConclusionsAll interventions led to increased stock of healthier foods. The combined intervention was effective in increasing sales of healthier snacks, even though discounts on snacks were not passed to the consumer. Experimental research in small stores is needed to understand the mechanisms by which store-directed price promotions can increase healthy food supply and demand.

Discounts on fruit and vegetables combined with a space management intervention increased sales in supermarkets

To examine the effects of two interventions on consumer purchases of fruits and vegetables (F&V) on the Danish island of Bornholm: a 20% discount on F&V combined with improved shelf-space allocation, and improved shelf-space allocation alone. A space management intervention to promote F&V sales was performed in two large discount supermarkets on Bornholm in Denmark for 3 months (September-November 2012). In addition, a 20% discount on F&V was introduced for 3 months in one of the supermarkets ('space + price'). The effect was evaluated using sales data from the two intervention supermarkets and three control supermarkets from the same supermarket chain but in Odsherred, Denmark (control area). Both the effect on sales of fresh F&V and potential unhealthy substitution effects were evaluated using multi-level regression analyses. During the price intervention period, the index number for sales of fresh vegetables increased by 22.2% (P=0.001) in the 'space + price' intervention supermarket compared with the control supermarkets. Furthermore, the index number for the sale of organic fresh fruit and vegetables increased by 12.1% (P=0.04) and the sale of the total amount of fruit and vegetables (fresh, frozen, dried and canned) increased by 15.3% (P=0.01) compared with the control supermarkets. In the 'space only' intervention supermarket no significant increase in the sale of fruit and vegetables was found. No unhealthy substitution effects were found. In conclusion, a 20% price reduction on F&V significantly increased sales of F&V. The effect was most pronounced on vegetables and no negative/unhealthy substitution effects were found.

Potential dietary outcomes of changing relative prices of healthy and less healthy foods: The case of ready-to-eat breakfast cereals

Many prevalent and costly health disorders in the U.S. can be attributed in part to poor diets, overconsumption of calories, and physical inactivity. Taxing less healthy foods and subsidizing healthy foods as a strategy to improve diet and health has attracted growing interest among policy makers and researchers. We test this strategy by using national household purchase data to estimate a censored, price and expenditure endogenous demand system for 12 food groups that are commonly consumed at breakfast: low- and high-nutrition ready-to-eat breakfast cereals, eggs, breads, hot cereals, breakfast bars, juice, whole and reduced-fat milk, yogurt, meats, and coffee. The estimated demand elasticities are applied to nationally representative food intake data to simulate—under the assumption of perfectly price elastic supply—the potential dietary improvement from taxing low-nutrition and subsidizing high-nutrition ready-to-eat breakfast cereals. We find that the demand for both types of cereals is own-price inelastic, suggesting that consumers are not likely to make large shifts in consumption of cereals if the price changes. Thus only limited dietary improvement can be expected from taxes and subsidies. Furthermore, when the healthfulness of breakfast foods is evaluated using a comprehensive list of nutrients and food components, a price intervention strategy may result in unintended, adverse impacts. Our simulation results suggest that the hypothetical price intervention actually increases the calorie content of foods consumed at breakfast.

The Quest for Reasonable Retail Energy Prices in Europe: Positive and Normative Dimensions

Public opinion in various EU Member States increasingly perceives energy prices as unreasonable. Primarily owing to distributional concerns, state interference with the liberalized retail energy market is ever-present across many EU Member States, despite its implications for the development of competitive (national and EU) energy markets. Rather than solely engaging with the conditions of state intervention as such, this article takes a step back and argues that an appreciation of what constitutes a reasonable price for energy supply is a necessary prerequisite in determining the relevance, scope, and conditions of state intervention in retail energy prices. In the absence of a definition of the concept in secondary legislation, it offers a novel conceptual framework centred on the contextual interpretation of ‘a reasonable price for energy supply’. This article offers two understandings of reasonableness: one underpinned by the principle of market competition and the other understood as affordability. It elaborates on the different set of conditions and criteria against which they are judged and it explains how these have informed various instruments enshrined in the energy liberalization directives for achieving reasonable prices for end-consumers. These range from consumer empowerment measures to more direct consumer protection measures informed by affordability concerns. After providing a taxonomy of the latter instruments, it examines their respective advantages and disadvantages by focusing on how these are perceived by the EU framework. Its broader aim is to contribute to a more nuanced understanding of what is meant by a ‘reasonable retail energy price’ within the context of national and EU competitive retail energy markets and explore how the resulting tension between the two understandings of reasonableness is accommodated in the broader EU constitutional and institutional context.

Effects of certification schemes for agricultural production on socio‐economic outcomes in low‐ and middle‐income countries: a systematic review

Effects of certification schemes for agricultural production on socio‐economic outcomes in low‐ and middle‐income countries: a systematic review

What is the effectiveness of obesity related interventions at retail grocery stores and supermarkets? —a systematic review

BackgroundThe Prevalence of obesity and overweight has been increasing in many countries. Many factors have been identified as contributing to obesity including the food environment, especially the access, availability and affordability of healthy foods in grocery stores and supermarkets. Several interventions have been carried out in retail grocery/supermarket settings as part of an effort to understand and influence consumption of healthful foods. The review’s key outcome variable is sale/purchase of healthy foods as a result of the interventions. This systematic review sheds light on the effectiveness of food store interventions intended to promote the consumption of healthy foods and the methodological quality of studies reporting them.MethodsSystematic literature search spanning from 2003 to 2015 (inclusive both years), and confined to papers in the English language was conducted. Studies fulfilling search criteria were identified and critically appraised. Studies included in this review report health interventions at physical food stores including supermarkets and corner stores, and with outcome variable of adopting healthier food purchasing/consumption behavior. The methodological quality of all included articles has been determined using a validated 16-item quality assessment tool (QATSDD).ResultsThe literature search identified 1580 publications, of which 42 met the inclusion criteria. Most interventions used a combination of information (e.g. awareness raising through food labeling, promotions, campaigns, etc.) and increasing availability of healthy foods such as fruits and vegetables. Few used price interventions. The average quality score for all papers is 65.0%, or an overall medium methodological quality. Apart from few studies, most studies reported that store interventions were effective in promoting purchase of healthy foods.ConclusionGiven the diverse study settings and despite the challenges of methodological quality for some papers, we find efficacy of in-store healthy food interventions in terms of increased purchase of healthy foods. Researchers need to take risk of bias and methodological quality into account when designing future studies that should guide policy makers. Interventions which combine price, information and easy access to and availability of healthy foods with interactive and engaging nutrition information, if carefully designed can help customers of food stores to buy and consume more healthy foods.Electronic supplementary materialThe online version of this article (doi:10.1186/s12889-016-3985-x) contains supplementary material, which is available to authorized users.