Does a Nutritious Diet Cost More in Food Deserts?

Food deserts and their potential effects on diet and nutrition have received much attention from policymakers. While some research has found a correlation between food deserts and consumer outcomes, it is unclear whether food deserts truly affect consumer choices. In this article, we compare food prices in food deserts, defined as low-income, low-access census tracts, and nonfood deserts to observe whether and to what extent consumers face higher prices for a complete diet in food deserts. If a nutritionally complete diet costs significantly more in food deserts, resident consumers may be constrained from consuming healthier foods. We use data on storelevel sales from a nationally representative sample and calculate a census-tract level Exact Price Index (EPI) based on a food basket defined by the Thrifty Food Plan (TFP). The EPI addresses potential biases from both product heterogeneity and variety availability. We have three central findings. First, prices for common foods are not significantly different between food deserts and non-food deserts. Second, after controlling for differential access to food variety, we find that the EPI in food deserts is 3% to 5% higher than similar census tracts with more store access and 4% higher than low-access census tracts with higher income. Third, the higher EPI in food deserts is largely driven by the lack of supermarkets nearby.

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JEL Codes:
Q18; D40; L66; R32; I3

 Record created 2017-04-01, last modified 2020-10-28

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