NIFK14027U Consumer Economics and Food Policy
The aim of the course is to give the students a basic understanding of economic thinking in relation to decision making by consumers and producers in the food domain, and to provide an overview of economic policy instruments that can be used to affect the food market.
How can we apply economic mechanisms to mitigate levels of obesity, increase consumption of plant based foods, or reduced climate impacts related to food consumption? This course gives a basic understanding of how economics can be applied in the markets for food products. It enables the students to address the role of economics in relation to food innovation, food system design, food marketing and food policy. The course focuses on three topical areas: Consumer behavior, Food service and retail sectors, and Public regulation.
Economics of consumer behavior
Consumer acceptance is central to the success of marketing of new innovative food products. It is therefore essential to understand the main drivers of consumers’ demand for new differentiated products. How do consumers make trade-offs between different characteristics of the food products, for example between sensory quality and safety attributes, between naturalness and convenience, between price and environmental sustainability, etc.? How much are consumers willing to pay for specific product attributes and how are they affected by price changes? The course will go into a deeper understanding of such questions based on economic theory of consumer behavior, which is put into a broader perspective.
Economics of food service and retail sectors
Professional customers (food retailing and food service, such as restaurants, canteens, institutions) play increasing roles on the demand side of the food markets. How important is price in these firms’ sourcing of inputs for their activities? How important are other commodity attributes such as sensory quality, convenience, storability, nutritional value for groups with special needs? With an outset in economic theory of firm behavior, this part of the course will address the economic mechanisms underlying these industries’ demand for food commodities.
Food consumption and production may have unintended side-effects, for example in relation to health (such as food safety or nutrition-related issues) or environmental impacts (e.g. greenhouse gas emission, nitrate leaching, pesticide pollution). The course will go into a deeper understanding of market failures (where the market mechanism tends to yield sub-optimal outcomes for society) and their implications for food production, marketing, innovation and policy. Policy tools used to remedy market failures as taxes, subsidies or labelling schemes will be discussed.
For each of the three topical areas, the learning activities will be centered around 1-2 illustrative cases, which will be used to explore the theories and their use.
The aim of the course is to give the students a basic understanding of economic thinking in relation to decision making by consumers and producers in the food domain. In addition, the course provides an overview of economic policy instruments that can be used to affect the market.
After completing the course the students should:
Have a basic understanding of the mechanisms behind consumers’ demand for food products
Have a basic understanding of methods used to collect data concerning consumer preferences including both stated preferences and observed preferences
Have a basic understanding of the mechanisms behind professional customers’ demand for food products
Have a basic understanding of different types of public regulation in the food market
Be able to define central concepts within the area of microeconomics and consumer behavior
Be able to describe different methods to uncover consumer preferences
Be able to describe basic considerations in relation to marketing of new food products
Be able to apply microeconomic theory to analyse elementary economic problems in the food area
Be able to describe basic principles of different regulation instruments
Cooperate with fellow students in analysing and solving different economic problems in a broader perspective
Communicate and discuss concrete economic problems and solutions with different target groups
Independently work with economic problems related to the food market
Text book supplemented with relevant articles
Steven E, Landsburg (2011), Price Theory – International Edition, 8th edition, South-Western Cengage Learning.
Academic qualifications equivalent to a BSc degree is recommended.
The course includes a project. In the project, the students work in groups with a food market-related problem area that shall be analysed and discussed from an economic perspective.
Based on the project group work, an individual project report has to be submitted and approved by the lecturers as a requirement for the oral exam.
- Theory exercises
- Project work
- 7,5 ECTS
- Type of assessment
- Oral examinationOral exam 20-30 minutes, based on project report and on general curriculum.
No time for preparation
- Exam registration requirements
Submitted and approved project report
- Without aids
- Marking scale
- 7-point grading scale
- Censorship form
- No external censorship
Several internal examiners
Same as ordinary.
If the student has not handed in the project report, then a report must be handed in three weeks prior to the re-exam. It must be approved before the exam. If the student has passed the project report prior to the ordinary exam, it can be re-used at the re-exam.
Criteria for exam assesment
To obtain the grade 12 the student has to fulfill the Learning outcomes