In news first reported by Reuters, the FDA has placed a value of $5.27 billion on the “lost pleasure” consumers will experience when calorie counts go into effect under new menu labeling rules. This action enables the FDA to reduce its estimate of the health benefits of the legislation, which restaurant industry leaders view as costly and unnecessary regulation.
The “lost-pleasure” analysis is based on a concept called “consumer surplus” which has been used by economists to calculate the benefit that communities derive from goods and services that cannot be fully captured by monetary value alone (ex: the community value of parks, etc).
However, some economists say the analysis is not warranted, since the FDA is not banning a product.
“The FDA said the analysis balances the benefits to consumers when calorie information leads them to eat healthier with the sense of deprivation people may feel when they give up foods they enjoy…
According to FDA documents, for the lost-pleasure analysis the agency relied almost solely on a 2011 paper by then-graduate student Jason Abaluck. In an interview, he defended the FDA’s decision to reduce its estimate of the health benefits from labeling in part because “healthier foods are worse off on other dimensions such as taste, price, and convenience.”
UC Food Observer has previously written about the FDA menu labeling legislation; you can read that here.