Bacon causes cancer: Do consumers care?

Abstract

In October 2015, the International Agency for Research on Cancer (IARC) released a report classifying processed meat as a type 1 carcinogen. The report prompted headlines and attracted immediate public attention, but the economic impacts remain unknown. In this paper, we investigate the impacts of the IARC report on selected processed meat prices and purchases using retail scanner data from US grocery stores. We compare changes in prices and sales of selected processed meat products to a constructed synthetic control group (using a convex combination of nonmeat food products). We find a significant decrease in bacon prices in the wake of the IARC report release, but we find no evidence of a sales reduction. We find no significant changes in price and sales for ham and sausage. The pattern of price and quantity changes are consistent with downward shifts in demand and outward shifts in supply for bacon and sausage following the release of the IARC report.