Impact of Healthy Food Labels on Consumer Choice and Valuation

The obesity epidemic is prevalent across the entire United States, but minority communities are affected most of all. The Rosebud Indian Reservation in South Dakota is a minority community that has been particularly affected by the obesity epidemic, exhibiting higher rates of obesity and lower life expectancy than the rest of the country. In this study we conducted a hypothetical choice experiment to test the effectiveness of three healthy food labels in increasing the likelihood of consumers choosing to purchase healthy products. We also calculated the consumer willingness to pay for each of these labels and examined differences in label effectiveness between different demographic characteristics. We found that a culturally relevant label was effective across all demographic groups, but only when accompanied by information that it was produced with input from the local population. We also found that overweight and non-overweight consumers respond differently to different labels. Finally, we found that consumers are willing to pay a premium for products containing the most effective healthy food labels. Advisor: Christopher Gustafso