Summary of Findings: Discussing the Hypotheses

To summarise and discuss in a structured manner, the author refers back to the initial research hypotheses and questions. A further discussion will also be presented in following subchapters.

The first hypothesis states as follows:

Hypothesis 1: Meat consumption causes unaccounted cost

(=externality cost) on society. Confirmed

Amongst others, it was discovered that meat contributes up to 80% if food based GHG emissions, as well as contributing to nitrogen & phosphorus emissions, all of which are causes for major environmental damage.

In terms of health care, the research uncovered that red and processed meats are known to cause cancer, when consumed in too high quantities, making cancer rates as high as 30% in western countries. Meat consumption also increases the risk of CHD, the number one cause of death in many western countries. Also, the mortality rate was found to be 20% lower for vegetarians than meat-eaters.

Meat production is said to be inefficient, with numbers such as 1 kilogram of meat protein requires feeding 6 kilograms of plant protein on average. However, those costs are, for the most part, not accounted in today's meat prices and are what one would call externality cost. One can confirm hypothesis 1.

The second hypothesis discussed the utility meat generates:

Hypothesis 2: Meat consumption generates personal

utility to the consumer. Confirmed

The research highlighted that consumers receive a variety of utility from meat consumption, such as form utility and the need for flavourful food, as well as the

representation of affluence and a certain social status. It is very insightful that consumers are willing to pay a higher price for meat-based products, indicating just how relevant meat is to their consumption basket.

Furthermore, when assuming the current structure of the food system, meat may also provide certain health benefits to consumers. There is a considerable risk when switching from meat to alternative products, whilst disregarding the need for a nutrient-balanced diet. This could lead to further health complications, especially where a lack of knowledge exists.

Lastly, a striking argument was that a loss of utility due to taxation might be imposed disproportionally much more on the less wealthy. As their income proportion on food is significantly higher, and the price sensitivity greater than those of more affluent people, a widening gap between the income groups could be a severe adverse effect generated. Overall, hypothesis 2 can also be confirmed as true.

Hypotheses 3-5 are related and discuss taxation and its effect on utility.

Hypothesis 3: Meat consumption’s demand is not

perfectly inelastic. Tentatively Accepted

Hypothesis 3 has been investigated by secondary literature. As indicated in Table 3 (Chapter 3.2.1.), none of the price elasticities equal zero, which would constitute perfect inelasticity. The price elasticity of meat in the more affluent Sweden seems to be lower than in the EU27 average.

In the Van Westendorp questionnaire results, consumers indicated that they are aiming to buy the same quantities of meat, regardless of the price. However, it is unlikely that their responses would hold true outside of the theoretical setting, as an increase in price would lower their overall purchasing power; Hence an income and substitution effect could be expected. Furthermore, this may be the result of a biased sample, and the sources of Wirsenius (2011) and Säll (2018) are assumed more reliable by the author.

Also, the Price Sensitivity analysis of the Van Westendorp method indicates consumers to be reactive to price changes. Hypothesis 3 will thus be accepted as true, but more research could be useful to confirm the literature findings.

Hypothesis 4: A tax on meat would reduce the

amount of meat consumed by consumers. Tentatively Accepted

For this hypothesis to be declared valid, the tax needs to lead to a price increase significant enough that it influences consumers’ purchase decisions and reduces demand. As analysed from Springmann (2018) and Säll & Gren (2015), taxes based only on health or environmental cost reasons could easily amount from 3SEK to 32SEK per kilogram of meat. The elasticities of meat, as calculated by Wirsenius (2011) and Säll (2018), have been confirmed to be negative. Furthermore, the literature confirms that one can reasonably believe taxes to lead to a reduction in meat consumed when its price increases.

However, it is interesting to note that in the survey, 60% of respondents indicated that a heightened and fairer price would not reduce the amount they would consume. As discussed, this self-assessed perception of the respondents is likely limited in validity.

It is relevant to note, however, that those respondents were on average willing to spend 15-20SEK more per 200g of meat if that meant it incorporated externality cost. It would be very interesting to investigate in a lab study what the demand for meat would be at the different price points as calculated in the Van Westendorp method, and whether differently perceived quality would change consumers purchase behaviours as much as they indicated it would.

Overall it can be assumed that a tax, and hence increase in price, would decrease the meat demanded by consumers, to what extent however is unclear. The hypothesis can hence be tentatively accepted.

Hypothesis 5: Taxing meat consumption would

cause a loss of consumer utility. Tentatively Accepted

Hypothesis 5 can be confirmed by the given literature review. As has been established by Edjabou and Smed (2013), and Säll (2018), taxes on meat cause a welfare loss on the consumer. However, the loss of utility in Sweden depends strongly on the type of meat, the amount of the tax and the quantity of meat consumed. For beef, the 2009 utility

of the average income group was 12,64SEK for instance, whereas for chicken and pork it was only slightly more than 3SEK each. Computing an average utility loss, while useful in theory, would not translate in the individuals’ utility loss.

This was further confirmed by the sensitivity analysis, that showed that the CV for the smaller income group was significantly higher than for the more affluent one, indicating a bigger loss of utility. This confirms the literature reviews view, that a tax on food is regressive. However, the potential long-term gains stemming from reduced meat consumption, that may also translate into utility, are not discussed in the literature. A final note is that at least for beef, consumers who were aware of meat’s adverse impacts were also willing to pay a higher price for it.

Lastly, hypothesis 6 needs to be discussed, tackling the main research question.

Hypothesis 6: By limiting meat consumption, the reduction in a) Environmental Cost and b) Health Cost each outweigh the utility that

individuals receive from meat. Tentatively Accepted

This was split into two sub-questions to analyse separately.

Sub-question A can be confirmed as true. The costs induced by meat consumption are overall significantly higher than the utility, measured by compensating variation.

However, while this is clearly true for beef and also pork, chicken may be a different case, which would need to be analysed separately. Here, the compensating variation for the average income group is only minimally lower than the environmental damage costs it creates, and the welfare loss for the lowest income group even exceeds the costs.

Regarding question B, more research is needed. While the measures are too inaccurate to determine the concrete discrepancy between cost and welfare reduction, one can note, however, that CV is seemingly lower than cost; hence the topic deserves a greater focus in the future. What can be clearly said is that the cost imposed by red and processed meat on society are significant. Yet, how this related to white meat, as well as only unprocessed red meats, was not evident.

Overall, the hypothesis can be tentatively accepted, as environmental costs alone already exceed the compensating variation. Nevertheless, it is clear that more research is needed to confirm or reject the hypothesis fully, and to obtain a better understanding of the impact meat has, both positive and negative.