The Impact of a Plant-Based Diet on the Economy

In recent years, there appears to have been a shift towards a more plant-based diet, which has had tremendous economic implications. The reasons that people are increasingly choosing a vegan diet are mostly twofold. Some people choose a vegan diet because they are seeing a decline in their health ultimately caused by a meat-heavy diet, and others may have been made aware of the detrimental effects that large-scale livestock farming has on the environment. By taking up so much land, water, time, and money, livestock farming creates most of the greenhouse emissions that destroy our Earth. For a multitude of reasons, it seems, people are adopting a more plant-based, less animal-centered diet. Now, what might this mean for the economy? 

Think of how much consumers spend on meat or animal products in general. Now compare that with the amount the same people spend on organic fruits and vegetables. If you already tend to eat a more plant-based diet, very good. If not, like many, you may also be increasing the  demand for animal products, and progressing a grossly unsustainable and extremely detrimental practice. More people are adopting a more sustainable and healthy diet as the many benefits are coming to the fore. As we know, consumers, to some extent, control the market, or at the very least influence its direction and magnitude. So, how are the many companies, restaurants, and society in general reacting, or might I say adapting, to this change in consumption? 

Recently, many fast-food chains began to adopt or at least include a vegan option on their menus, and individuals are starting to see evidence of changes in their consumption start to swell up in their pockets. KFC, for example, has already hopped on board as their menu now features a vegan burger. Lucy Wright writes, “On 2nd January 2020, coinciding with veganuary, [KFC] began selling their original recipe vegan burger…” (Wright 2021). Here, we see that a traditionally chicken-based menu now includes a vegan burger as a response to the increasing demand for vegan products. This appears to be evidence that the market follows what its consumers crave, so as the “trend” of veganism continues to rise, many fast-food restaurants (and restaurants in general) are going to have to adapt to this shift in food consumption so as to continue to maximize profits. KFC is maximizing its reach in society so as to maximize its revenue. Not only KFC, but other fast-food chains such as Burger King, Shake Shack, and Johnny Rockets have added their version of a vegan burger on their menu as well. It appears as though it’s only a matter of time before not only other fast-food chains but restaurants and food processing companies do the same exact thing. If they don’t, they risk missing out  on the increasingly large opening in the market.

While many companies are deciding that it’s time to include a vegan burger on their menu, there also exists a change on the individual side of things. In a model which predicts the trajectory of the economics of a plant-based diet in the United Kingdom and Belgium, it was found that if just 10% of the population adopted a diet of high intake of vegetables and low, if any, intake of red meat, the society would save 1.55 Billion EU and 7.83 Billion Pounds over the next two decades (Schepers and Annemans 2017). Societal costs, such as the price of goods and repairs of natural disasters, would decrease greatly, not to mention the fact that the general health of the population will improve immensely. While this model wasn’t made to demonstrate the savings Americans could buy, it’s interesting and exciting nonetheless that many European countries appear to be moving in this direction. In addition, Political scientist Janina Grabs, who has studied Swedish consumers’ spending habits in detail, found switching to a vegetarian diet meant savings of about 10% on food and drink costs” (Grabs 2015). Not only that, but her study also modeled a scenario in 2050: “In the vegan and vegetarian cases not only was global mortality reduced by 6-10% but the savings in healthcare and lost work productivity came to $1 trillion a year. Using a statistical measure of the value of lost years, the numbers were even higher, $28 trillion and $30 trillion a year, a staggering 12 and 13% of projected global GDP.” Many of the different studies vary quantitatively, but what they do seem to have in common is qualitative; veganism is good for the individual and the society. It appears as though college-aged students are the catalysts for this change. 

Callum Chesire found that “...the catalysts for the decrease in meat consumption in the United Kingdom are 18 to 24-year-olds” (Chesire 2020). So, at least in the United Kingdom, college-aged people are leading this change. It begs the question, if we are simultaneously the catalysts in this change in diet and the next generation to bear children, is it fair to assume we will instill similar values and dietary preferences on our children? One theory is that veganism is a cultural phenomenon and that the rise of veganism amongst college-aged students is somewhat correlated with their education level and to how people tend to do what their friends do, creating a growing circle of people. During a series of interviews at Bucknell University investigating  cultural and age differences in veganism, one student interviewed expressed the social aspect of veganism. A student said, “I had a support system at [college] knowing that other people were vegan. It made me more comfortable; knowing other people were doing this at the same school” (Frawley 2017, 56).

Yes, there does appear to be a social aspect of veganism that seems to drive the number of people who consider their diet vegan among college students. Additionally, there is some reason to believe that considering and adopting a vegan diet has a correlation with one’s level of education. Frawley writes, “For many interviewees, the college setting was crucial to informing their decisions. Given that all the interviewees have completed or are in process of completing (at least) a bachelor’s degree, this narrative is especially pertinent by further reflecting the significance that higher education has on veganism” (Frawley 2017, 68). It’s both the setting and the product of education in a certain environment that has a great effect on one’s diet. This is why we see so many college-aged vegans. We can already see the economy changing as a result of our decisions now, but it will be interesting to see how it will be in some years when it may become less likely that someone consumes meat than not. 

Not only could an increase in veganism reduce our carbon footprint, but it could also make way for a massive increase in employment. In a study done in partnership by the International Labour Organization and the Inter-American Development Bank, Lucy Danzinger, the Editorial Director and Chief Content Officer of The Beet, writes that our current way of living “calls for the ‘decarbonization’ of our food systems, and a switching over to net-zero emissions, which would create up to 22.5 million jobs in Latin America and the Caribbean within the next ten years…” (Danzinger 2020). As the market shifts, it creates many opportunities for new jobs at companies like  Beyond Meat, Oatly, and MeaTech. As plant-based companies and restaurants continue to grow, they’ll need people to work there. A large amount of unemployed Americans now have and will continue to have more options for work. While some jobs are soon to cease to exist, others, and presumably far more, will continue to be created. 

While many people shift to a plant-based diet because of environmental and ethical reasons, Paige Lawler argues that a vegan diet isn’t necessarily a more ethical one. “In fact, depending on people’s consumption choices, being vegan can be less ethical and less sustainable than a ‘normal’ diet” (Lawler 2020). It is vitally important to consider the sourcing of fruits and vegetables so as to ensure they are not grown and harvested using modern-day slave labor. For instance, a large number of immigrant workers are exploited for their labor and are made to work unbearable hours in tough conditions to provide us with the fruits and vegetables we consume. Additionally, this change in dietary preference inevitably leads to a shift in the type of demand. If we are no longer consuming animal products, or at the very least, far less, we would be relying much more on growing and distributing crops. We could, in theory, ravish the Earth in a similar manner than we already are with the meat industry. Because there is limited data at this point in time about the vast economic and societal changes that would be brought about by a shift in diet, there is also a limited amount of certainty coupled with it. We won’t know for certain what will change about the condition of our Earth once we no longer raise livestock and revert back to agriculture. What we can say with certainty, however, is that the change is real, the change is significant, and the change is already happening.

As people have been unwilling to change with the condition of our home, we have left the Earth no choice but to undergo drastic changes in its condition. This change, among other ways, manifests itself in veganism; a healthier and environmentally conscious decision. While these changes are both beneficial and noble, they also have massive effects on the economy. As the percentage of people who identify with eating a plant-based diet increases, the market reacts accordingly. Many companies are seeking profit maximization by including a vegan option on their menus. In addition, many predictive models in Europe find that the individual and societal savings that would be brought about by a plant-based diet are significant. Lastly, not only will a societal shift to adopting a plant-based diet have incredible implications on companies’ offerings and individual and societal savings, there will be a massive amount of jobs to be filled by this new market of consumption. Veganism is the future for one’s health, our environment, and certainly economics. 

References

Cheshire, Callum. “The Rise of Veganism and Its Impact on Spending on Meat.” Frontier Economics, January 2020. https://www.frontier-economics.com/uk/en/news-and-articles/articles/article-i6912-the-rise-of-veganism-and-its-impact-on-spending-on-meat/#.  

Danziger, Lucy. “Switching to a Plant-Based Diet Will Create 19 Million More Jobs.” The Beet., August 3, 2020. https://thebeet.com/by-shifting-to-a-plant-based-diet-we-can-create-19-million-new-jobs-study-finds/.  

Frawley, Emma Sanford. “Veganism as a Cultural Phenomenon.” Veganism as a Cultural Phenomenon , April 1, 2017. https://digitalcommons.bucknell.edu/cgi/viewcontent.cgi?article=1392&context=honors_theses. 

Grabs, Janina. “The Rebound Effects of Switching to Vegetarianism. A Microeconomic Analysis of Swedish Consumption Behavior.” Ecological Economics. Elsevier, May 19, 2015. https://www.sciencedirect.com/science/article/pii/S0921800915002153.   

Lawler, Paige. “Opinion: Veganism Isn't Necessarily the Most Ethical or Sustainable Option.” Pitt News. The Pitt News, September 22, 2020. https://pittnews.com/article/160250/opinions/opinion-veganism-isnt-necessarily-the-most-ethical-or-sustainable-option/. 

Schepers, Janne, and Lieven Annemans. “The Potential Health and Economic Effects of Plant-Based Food Patterns in Belgium and the United Kingdom.” Nutrition. Elsevier, December 15, 2017. https://www.sciencedirect.com/science/article/pii/S0899900717302861. 

Wright, Lucy. “Economics and the Environment: The Rise of Veganism.” The St Andrews Economist, February 21, 2020. https://thestandrewseconomist.com/2020/02/21/economics-and-the-environment-the-rise-of-veganism/.