# Economic Drivers of Global Food Quality

**Podcast:** The Economics Show
**Published:** 2026-02-06

## Transcript

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What does an economist eat for lunch?
Powdered food for efficiency?
Or maybe seasonal veg for the climate.
And how is economics relevant for what we eat?
My guest today has thought a lot about these questions and the answers that tell us about incentives, globalization, and how the modern economy really works.
This is the Economics Show with Samea Keynes.
I'm joined this week by Tyler Cowan, who is speaking to me from Fairfax, Virginia in the suburbs of Washington, DC.
Tyler is a professor of economics at George Mason University, economics blogger and writer Extraordinaire, and host of the Conversations with Tyler podcast.
Tyler, hello.
Hi, good to be chatting with you.
I've only had a yogurt for breakfast.
Let me warn you.
Okay, that's fine.
You're allowed to stay on the podcast.
Okay, on this show, we always start with a question on a scale of from one to 10.
So, on a scale of one to 10, how important do you think food is to the average person?
Well, as economists, we're trained to think at the margin.
If you mean food at all, it's important at the level of a 10.
Without food, you die.
Even to go hungry for a day feels pretty grim.
But at the margin, I don't know.
People like to complain about current high food prices, but I don't think they're much less happy.
And you could eat 10% less or eat different things, and if your life was fine to begin with, it still would be fine.
Okay, so I need a number on the margin.
On the margin, I don't know, 3.8.
Okay, very specific.
I like it.
Okay, so on that same scale, how important is food for you?
Much higher than 3.8.
So a lot of my travel is organized around food or trying out new things.
I eat food to learn about supply chains, to learn how immigration works, to think about globalization, to better understand the histories of countries, how they relate to their neighbors, the importance of discovering the new world.
I don't know, when it comes to food, can I be at a 9.246?
You wanted specificity.
And you have given me that.
Yes, I'm very satisfied with that answer.
And I've learned how to eat very well very cheaply.
That's important.
I I don't feel I can do that in London, but most of the places I go, I feel I can eat superb meals very often for less than $10 or 10 pounds a meal.
Okay, great.
Well, I want to get to those tips on how to replicate that shortly.
But first of all, can I just ask do you think that you approach food differently because you're an economist?
Or is it that economics explains the approach to food that you would have even if you weren't an economist?
I don't think in terms of those boxes so clearly.
So in my view, there's stuff.
And you're out there in the world and you encounter stuff.
And some of that stuff is food, which for me is 9.246 on the scale you constructed, and you try to make sense of it.
Maybe anthropology is always coming before economics, but economics is part of the worldview.
You apply to the stuff.
But it's not just food, it's really any kind of stuff you encounter.
Like you walk into Daunt Books in London and you look at what's on the front table and you start thinking, well, why is that there?
And you can think of terms of, well, what's the markup on that book?
Is buying front table space for it more likely to make it go viral?
Since Daunt branches are determined by local demand, how does that, you know, feed into what's on the front table?
And you just start thinking.
And same with food.
So I guess it all springs from being this obsessive who wants to anthropologically dissect stuff all the time.
Okay, but what you're describing sounds more diagnostic, right?
It sounds more like using the economic framework to explain what's there rather than say use economics to make different choices.
No, once you understand certain things about food, you can eat much, much better.
So, for instance, the simple fact that a lot of the biggest food problems in Italy will come in Venice, Florence, and Rome, follows pretty readily once you know even a small amount about tourism.
You don't need to be a very sophisticated economist.
So Venice is maybe the worst place to eat in all of Italy.
I think it's about 60,000.
You could call them native Venetians, or maybe they're not native, but they're living and working in Venice.
It's not many people.
But if you go to Veneto, you know, which is right outside of Venice, which is ugly and hot, the food is incredible.
So a lot of the key lessons, I think they're quite simple.
It's merely the willingness to think systematically about what you're doing that's scarce, not some deep understanding of economics.
So you've now said this a few times, right?
You you've said, well, the food here is is good and the food there is less good.
So can you define what counts as good food?
Well, I could define it if I brought you there.
I'd sit you down and I'd say, here, try this, and you would nod your head and agree with me.
But I believe that if a person has some basic degree of food openness, uh, that there's a lot of consensus as to what's good.
But can't we be any more precise in that?
I mean, freshness, unusualness of the ingredients, uh variety, you know, we could talk about protein, fat, fiber, I mean, all sorts of properties of food that you can pin down.
Sure, but I'm reluctant to set up a scale.
So take freshness.
I mean, most cases that's a good thing.
But if it's one of those stinky eggs in Taiwan, or if it's fermented Korean foods, you're not looking for freshness.
You're not quite looking for the opposite of freshness.
But if you're just thinking in terms of freshness, you're gonna miss what's special about it.
So the mere notion that having some basic openness and going around and just trying different things and talking about them, I think gets you furthest.
And again, I think you and I, if we went to food stalls in Oaxaca or Puebla, we'd agree 87% on what's best.
And I don't really know anything about you and food.
I just figure if you want to do this episode, you're high in openness, you're super smart, you're curious.
So we're mostly going to agree.
But if it ends up like you like sandwiches more than I do, I like very spicy more than you do, that's fine.
We we know some of that might be just a genetic difference, like in spice tolerance.
I mean, I've spent a lot of my life eating essentially powdered food.
Okay, maybe not a lot of my life, but a bunch of time eating powdered food.
But I don't think you and I would so much disagree as to how good the powder is.
If you had a pretty good powder, I think I'd say, oh, that was a pretty good powder.
Okay, so I mean, what you're saying is that basically you think that there is some kind of scale of good to bad, but we're not really able to say what the kind of parameters of that are.
It's just a sort of sense.
Do you have a a sense of what counts as a as a good food culture?
Like some places have a better food culture than others.
Oh, absolutely.
Italy is one of my favorites, Malaysia is incredible, Mexico is one of the top for me.
How does economics contribute to that?
To where has a good food culture and where doesn't?
Uh let's take Mexico, for instance.
So they have ingredients such as chiles, corn, you know, corn turned into masa, possibly tortillas that go back centuries, indeed millennia, that they have finely honed and experimented with, and they're sold in competitive markets, and they have incredible ingredients to work with, and Mexican people really care about food and typically have strong opinions about food.
Not every culture has that.
Like rural America often does not have that.
How do you think economic factors like inequality or I suppose you know female labor force participation contribute to a kind of local food culture?
There can be destructive inequalities that simply ruin a whole country and thus the food.
But putting that aside, when you have a fair number of customers who have enough money to buy the food, and then a lot of people who are much poorer and are quite keen to cook the food, they may have few other good opportunities.
In countries such as India and China, historically, that has given rise to excellent food and a lot of experimentation and very vibrant restaurant cultures because wages don't drive places out of business very readily.
So that can be a positive.
I'm not saying it's a positive for the whole country.
It's not a positive for the people who are poor, but it can make it a very good place to eat.
Now, female labor force participation, it's often better for the food when older women become cooks.
And this you see a great deal in Mexico, you know, abuelas, the grandmas.
And they carry these old food traditions, they know how to use ingredients.
They started cooking when supply chains were super short and before refrigeration was too common.
And they just know everything about the foodstuffs they have access to.
If you're in a culture where those women have better opportunities, they grow up to be doctors, lawyers, whatever, again, much better for the society as a whole.
But if you want that $2 uh incredible taco at the street food stand, you're probably not going to get it.
What do you think is the single most important technology when it comes to contributing and kind of improving our current food system?
And you're not allowed to say heating, which is just cooking.
Well, to take refrigeration, that is a mixed blessing.
There's an optimal amount of refrigeration.
So, one problem, I think, with Russian food historically is they had refrigerated box cars quite early.
There are vast distances in Russia.
In some parts of the country, because of the extreme cold, it's hard to grow things that are not wheat or relatively small number of other items.
So you have things being frozen, put on trains and shipped across the country.
And then when it arrives, it might be fine, but it's not really going to be all that interesting or special.
The United States also, with great distances, so much trucking, interstate highway system.
We have frozen so many things.
It makes a lot of our food, again, maybe fine, but just average.
I think of the United States as specializing in a particular kind of variety and only rarely being top of the line with respect to ingredients.
And that has to do with too much refrigeration and too long supply chains.
But let's not damn refrigeration entirely.
It's also the reason why things can be shipped from China, India, Mexico, whatever, and you get this incredible variety that you have, of course, in your London, in my northern Virginia.
And just to think through the economics of this, you figure out pretty quickly well, where should I be eating?
What should I be getting?
If you're in the United States, in most cases, do not be looking for the best ingredients.
Be looking for the chefs who know the best how to construct an interesting and complex sauce.
And for many things in London, I would say broadly the same principles hold.
When thinking about food, what do you think is the single biggest technological constraint to delivering good food?
The biggest technological constraint.
I think just the difficulty of scaling many of the best things.
So if you look at U.S.
corn, it's shipped in great bulk all over the world.
That process works.
It does not arrive super fresh.
It's spread to be durable and shippable and just cheap.
And it's fine.
I like it.
But it's very far from my favorite corn in the world, which might be in the Andes.
The farms there are super inefficient, very small.
There's some very local variety of corn that's grown.
It may have a strange color.
There's not a corn like it anywhere else in the world, and it's amazing.
So problems of scale, I think we won't really overcome.
You have to go to these places and uh consume the non-scalable items.
A lot of your restaurant dining advice seems to be associated with leisure dining, right?
So I've got an evening, I'm gonna go for a great meal, I can kind of travel anywhere.
But what about if you were an office worker trying to work out where to get your office lunch?
What's the economist guide to that?
Is this London or somewhere else?
I mean London and how would that be different in, say, New York?
I think London for a city of its wealth has relatively good, quick takeaway food, none of which is great, but compared to other cities of a similar sort, it is above average.
And there's such density of office space in London, you do have a lot of choices.
And I find this quite encouraging about London.
It's a very good place to get pretty good lunch food.
So if you're out, say by Google Deep Mind, where I was not too long ago, I walked out of the office, I had given a talk, and I saw a Turkish place.
It's the first thing you see as you head to the main road.
It was quite good.
And I knew it would be quite good.
Because there's people with some wealth, very high intelligence nearby, and they need something quick, but they want it to be good.
And I ate there and I was quite confident and it delivered.
You just had very high intelligence.
Do you think that that's correlated with your ability to discern good food?
Of course.
You know, it correlates with many things.
Your ability to discern what are good books or a good newspaper articles.
It's correlated with intelligence.
And if there's anywhere that has high intelligence, it's Google Deep Mind.
Now they're not the only people who work there, but in general, it's a neighborhood with a lot of finance, a lot of people who are highly analytical.
XTX is nearby.
And uh yeah, that makes the Turkish place better on average.
That's not something I had thought about before.
And I guess my assumption would be that actually your ability to enjoy or engage with food or kind of decide what's really, really good food is actually not very strongly correlated with, you know, intelligence along the dimension that, say, Google Deep Mind would would value.
Do we have any evidence for that?
Or is that just, you know, your hunch meeting lots of people?
Well, anecdotal evidence, but I'd say there's a sizable research literature showing that higher smarts are correlated with skill in many, many, many things.
I've never seen a paper on smarts and taste in food, but it would be shocking if that were somehow an exception.
I suppose I also think of taste in food as something that can be developed and learned, right?
And so I I haven't invested in developing a real taste for you know fine food, partly because I don't have time, partly because it would be ruinously expensive.
Um keep in mind in most of the world, the best food is quite cheap.
It's not expensive.
In most of the world, but I don't live two-thirds of the world.
Now you may not be there, you may have other obligations, but you can eat very, very well, fairly cheaply, and in the United States, which is never a super cheap country, but still often say Asian food at a lower price point is going to be better than non-Asian food at a higher price point.
Can I ask about the environment?
Economists think about externalities, there are lots in the food that we eat that is terrible for the environment.
What are your favorite examples of things that seem really great for the environment or seem terrible for the environment, but are actually the opposite?
Depends a great deal how it's made.
And what seems to be good for the environment can, in the larger picture, not be great for the environment.
So in poorer countries, you have all kinds of foods that are produced pretty simply with short supply chains and often do not involve meat.
And a lot of people think, well, that's great for the environment.
And in the short run, maybe.
But if it's not addressing, say, problems of malnutrition, you have stunted children who grow up a little shorter than they should be.
It keeps the country poorer, and the country then is likely to pollute for longer.
And it's not clear it's really good for the environment after all.
So figuring out which foods are good or bad for the environment, it's not always entirely simple.
But it does seem to me, if you want one basic rule, most of us could follow.
If you're in a wealthy country, eat somewhat less meat is a pretty safe rule that I think will help the environment and not harm animals plausibly help them, depending on the conditions under which they're raised.
What about local food versus imported food?
Are there any supply chains that are actually surprisingly efficient relative to something that's made nearby?
Well, very often having your food shipped in is more energy efficient and lower cost than having it grown locally.
So locovarism makes no sense.
It's very often bad for the environment.
If things are being shipped in, they're being shipped in because they're cheaper, all things considered, for the most part.
And if they're cheaper, that could mean a lower environmental burden.
So don't be a local.
I guess the the counter to that would be, though, that some externalities are not being priced, right?
And so the externality associated with the pollution isn't being priced, and that's why it's cheaper to import food.
Sure, but the externalities associated with the local costs.
Well, the person drives a truck for seven miles and it's sledded gas, that's also not being priced.
So those can go either ways, but to think that it's going to favor the local on net is unjustified typically.
Okay, but it's we don't know rather than it's always better to import than to buy locally.
Sure, but if you have localism as a ruling principle, that's a big mistake.
And I would just say, as a first-cut approach, to think that the method with the lower cost might have fewer externalities is not a crazy starting point.
It shouldn't be your final conclusion.
But lower cost means you're expending fewer resources, right?
Okay.
Can I ask now about international differences in dining?
So if you were to do a ranking, right?
So we've got the US, let's say France, Germany, Italy, UK.
Uh, how would you rank those countries in terms of the quality of their food, the food culture?
Well, the wonderful thing about Italy, Venice aside, is you can go almost anywhere and it's amazing.
So in that regard, you could say Italy has the best food culture, but variety in Italy is terrible.
It's very hard to find decent Chinese food or good Indian food.
So Italy is specializing in all these local regional monocultures, which are amazing.
But if I had to live there, I would love them much less.
France is pretty rapidly moving into more refrigeration, less freshness, fewer traditional foods.
So France is in transition.
It's changing more and more rapidly than Italy is.
German food, I think is quite underrated.
I certainly would not put it above either Italy or France.
But I think basic German dishes and with vegetables are excellent.
And especially if you're eating in southwestern Germany, they're very excellent.
And for foods from around the world, if you're in Berlin or Kerln or Frankfurt, the choice is really pretty good, not as good as London, but clearly better than most other places.
The United States was the fourth country.
Oh, it so depends.
I would say if you don't know what you're doing, it's one of the worst places in the world to eat.
If you know what you're doing, it's wonderful.
So one thing I do, for instance, is I order frozen sausages from Texas barbecue country, and they arrive at my house and I have a big stock of them.
And when I want one, I thought, and these frozen sausages, they actually freeze and thaw pretty well.
And they're excellent, and I can just do that, and then in my local neighborhood, I have amazing regional Chinese food, great Afghan food, Pakistani food.
But if I were doing what most people do, it would be very mediocre.
But I feel no anxiety having to live here.
I think I have a wonderful food life at reasonable expense.
If you live in the middle of nowhere, it's a lot tougher, though.
How do you think economics explains the international differences in the in the quality of food?
Well, if you're trying to think about Italy, uh, Italy has had uh less successful immigration patterns than say Germany has.
It attracts a lower diversity of people, and uh they don't do as well.
Now, Ethiopian food is quite good in Italy, but most foreign cuisines you just wouldn't eat in Italy flat out, and you shouldn't.
So that's one economic reason why Italian food has stayed Italian.
Italy unified quite late, as you know, so a lot of Italian food is still quite regional.
Dishes from one region you simply cannot get in another region.
They tend to be very excellent in the regions of their origin, and that again limits your choice but boosts your quality.
And that too is for this economic reason that both Italian taste and Italian supply chains have stayed pretty local for the most part.
So those would be some simple economic ideas you would apply to Italy and France.
I think the story is one where just processed and refrigerated foods, they're way more convenient.
French food, which again can be amazing, it's pretty slow, and French labor law makes it harder to hire and fire cheap labor.
So you're waiting forever for the waiter, and French people have done a workaround of just eating much more rapid foods because their wages are higher, they're less patient, there's other better things they can do.
Uh, and at the margin, that's made French food less special for economic, legal, and regulatory reasons.
Okay, I want to ask you to engage with me in a thought experiment, right?
So, what we're doing is we've got a new country, it's called Thailand, and your job as the the leader of this country is to design a really amazing food culture where the food is incredible.
What would you do?
What levers do you pull?
How would you make it happen?
Well, the food won't be good right away.
So we we've run versions of this experiment.
So Brasilia in Brazil is a pretty new city, right?
And I would say it's actually relatively successful as a city, but it's quite hard to find amazing food there.
They don't have a cuisine of their own.
They import other, mostly Brazilian, Italian, what you would expect, cuisines from elsewhere.
They're not bad.
There's enough purchasing power in Brasilia to keep it all going.
But you would never look forward to eating in Brasilia or in India, Bangalore.
It's not literally a new city, but it's been quite large and prosperous only lately.
There's not quite a food of its own in Bangalore.
So if you have a new city, I would just say uh it's it's tough going.
You're not going to do very well.
You leave.
That's what Tyler does is he leaves.
No, I'm not gonna let you leave.
Uh it can be a slow project.
That's okay.
The project can take a few years.
Invite in smart people from around the world, give them other things to do.
And just like this part of London near Google Deep Mind, uh let smarts and wealth work their magic, and you'll get a diverse set of offerings through good immigration policy.
And after a long time, the food will be quite good.
Okay, I think that is a good moment to cut to a break.
And when we get back, I'm gonna ask Tyler about what is changing in the economics of food.
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We are back from the break.
Okay, so you wrote your book, An Economist Gets Lunch in 2012.
If you were writing it today, would you write anything differently?
Well, I would have a whole chapter on what is being called food price inflation, which has been a big story ever since the pandemic.
When I wrote the book, it was before all that happened, so there was nothing to say about it.
But why do people perceive food prices as so especially high when often they're not adjusting for inflation?
Now it's interesting in the UK, food prices have gone up, I think about seven percent more than the general rate of inflation.
In the US, I think it's around only two percent more.
So on that, there is some extra price inflation in food.
Not that high in my country, much higher in yours.
But I think as with gasoline, the fact that we buy it so often means it really bothers us.
I think also in the US, at least, I'm not sure about London, but there's been a relative price shift.
Dining out compared to home dining is much more expensive.
So eating at home is more economical than it used to be.
People get upset at this.
I think it's hurt socializing.
Also, alcohol sales are down.
That is also made, you know, in relative terms, dining out more expensive because the food is not cross-subsidized by the drinks.
And those changes, you notice their import.
So now is not an amazing time where I live to be out there exploring new restaurants.
It makes more sense to get to know your old familiar ones very well and optimize with those and to perfect your home cooking.
And those are all new developments.
The thing about home dining that you mentioned, there was this recent uh study I saw that found that that restaurants had become much more productive since the pandemic.
Do you know the one I'm talking about?
Yes, Austin Goolsby, who runs the Chicago Fed.
That's uh a very interesting paper.
30% more productive, they claim.
I'm not sure they're defining productivity properly, because the thing that is doing the work, according to them, is people spending less time at the restaurant.
So you can serve more people.
The measured output goes up, but the unmeasured, how much did people enjoy themselves in the conversation?
Possibly that's down.
Now maybe people just want to get out and go to the movies.
Uh but it could be some of that increase in productivity is an illusion.
I guess there's also potentially the issue that in a restaurant you're paying someone to clean up, and that work is now moving into the household uh and not being paid for, as far as they can observe.
That's right.
But I think the general trend of people spending less time at the table, which again will also correlate with less drinking of alcohol, that is true, and it does matter for restaurants.
So there's just more turnover.
Okay, now I want to talk about immigration briefly, which is something you've already mentioned, but just in the context of what's going on with the Trump administration and changes in in migration policy, you know, and obviously, you know, how this affects the food environment is not the most important consequences of those.
But in the context of this conversation, are you seeing any effects already?
Or how do you think those changes will play out?
Some bad dark things are going on with immigration policy in my country, and I'm quite opposed to them.
I would note that the change in the aggregate numbers is much less than you might think, given what perhaps you're seeing on the evening news.
The biggest problem, I think, is with Latinos.
I sometimes like to say every restaurant in the US is a Mexican restaurant.
That is, the food is cooked by Mexicans in most restaurants, no matter what cuisine they're serving.
So a lot of these workers, whether they're legal or not, they're now afraid to show up for work because ice agents are targeting different places where illegal and also legal immigrants show up and they stay at home more.
Or in some cases they don't come to the U.S.
at all, or in a much smaller number of cases, they're being sent back or otherwise penalized.
So it's just made it harder to run any kind of restaurant at all.
And you said, well, you know, food isn't the main issue in assessing immigration.
I agree it's not the main issue, but I think it's quite an illustrative issue.
The point is we have a lot of the migration we do because there are gains from trade, and you see those gains from trade in the food sector, and you see those gains from trade and other parts of the economy, and those gains from trade are going down.
From my point of view, it's bad, both for food and more generally.
Okay, so I saw this really interesting paper on the rise of niche consumption.
So there's this idea, you know, that on the one hand, taste consumption has been becoming more homogenous around the world, but actually in the US, if you look at what people are buying, you see the rise of these niches, right?
So you we're not all buying the same flavor of Doritos anymore.
Some people are buying roast chicken flavored Doritos, and some people are buying sausage-flavored Doritos, and it's kind of falling into these smaller and smaller niches.
Have you have you seen that paper?
Do you recognize this?
And what's what's your opinion of it?
We see this in food markets.
So now, say food from Laos has become a quite normal category.
Most people don't eat it or maybe don't even know about it.
But for those of us who do, it's like, oh, Laosan food, whatever.
It's like a hamburger pizza, Chinese food.
That's a good place to be.
My worry for myself is just I've run out of new things to try, at least in the US.
I have to travel to do so.
So it used to be I'd see a Tibetan restaurant.
I'd get all excited.
I'm not excited anymore.
I still like it.
I might go to it.
Well, Tibetan, yeah, you know, like uh, here's some more pizza, right?
That's not exciting per se.
So uh I think it's one reason some food markets have slowed down that the people who love the niches, they're at corners where they've tried everything they can.
They're waiting for the next new thing.
It will be coming, but so far I don't quite see it.
For the last five years, in part due to pandemic, but not only, I haven't seen the next new thing in my country.
It's funny, I feel like you might be quite unusual.
I think a lot of people are much more habitual than you are when it comes to food.
Am I wrong?
I'm clearly at the extreme end of the spectrum of not being so habitual, but there's a lot of people like me, and we're all sitting around pinging each other online.
Well, what's the next new thing?
Where can I go?
And someone will say, oh, Eritrean, and I was all roll, oh, Eritrea, and yeah, I had that last week, you know.
So there's plenty of countries we don't get to eat the food.
So, say food from the southwest region of China from Yunnan, very hard to find here.
It's amazing.
There are supply chain problems.
Maybe it will come, and I'm waiting.
Okay.
Last question.
In a decade's time, or maybe two decades' time, what do you think is going to be the biggest change in the way that we eat?
We that's a tricky we there.
If you mean people in London, I suspect your government at some point will have a backlash against immigration, and your food choices will become somewhat worse, and food will continue in relative terms to be more expensive.
In the United States, I think our immigration will become more new world oriented, with or without President Trump or someone like him in charge, and our food will be more Latino, and GLP ones, especially in the United States, will be a big, big deal because we're the nation with one of the highest obesity rates, but it will affect you as well.
And I guess I'm a little bearish on food markets and quality food because of immigration and GLP ones.
Do you have anything more optimistic we could end on?
Well, it's super optimistic.
In fact, on average, we will live more years.
So any given meal you might be eating less.
But say you live for seven years longer, that's seven extra years to get to southwest China, Malaysia, rural Mexico, wherever it is you need to go.
And perhaps when you are 91 years old, you can join us on one of these food tours.
I look forward to it.
Tyler, thank you so much for joining me.
This has been a real treat.
My pleasure.
Hi, we're Jochen and Michi, Traveller, Autoren and Freunde.
Über 200 Folgen gibt's schon, von Japan bis Italien, von New York bis Sydney.
Our executive producer is Manuela Saragossa.
Cheryl Bromley is the FT's head of audio.
I'm Simea Keynes.
Thanks for listening.