Time Preferences, Risk Preferences and Choices of Healthy Diet: Evidence From Mekelle City, Northern Ethiopia.

Abstract

Diet-related morbidity and mortality now exceed those associated with hunger worldwide. Although risk and time preferences are correlated with dietary behavior, evidence from the Global South remains limited. In particular, the role of human-capital risk-distinct from health risk-in shaping dietary choices has not been systematically examined. This study addresses this gap using incentivized lab-in-the-field experiments and 2024 survey data from Mekelle city, northern Ethiopia. A control-function approach accounts for potential health-status endogeneity, Oster's coefficient stability test assesses sensitivity to unobserved heterogeneity, and double Lasso tests the exclusion of insignificant variables while controlling for structural errors. Results show that impatience, impulsivity, and risk aversion are generally negatively associated with demand for healthy dietary components, although associations vary by outcome. Risk-averse subjects report stronger healthy-eating intentions but exhibit comparatively lower observed investment in healthy foods, consistent with concerns about human-capital risk.