The Environmental Economics of Locavorism

I hope my readers will accept this question in good faith, and not think that I am just rationalizing a swipe at hipster trendiness. I am curious about the full logic of the argument that buying food from local sources is good for the environment. As my earliest readers know, I think there is a logical argument to be made that local food could have superior robustness and healthfulness that we are as yet unable to detect. I also think that if people get some sort of intangible, aesthetic pleasure, at the idea of upholding farms that are near their homes, that’s great — whatever floats your boat. But I don’t yet fully accept the argument that local foods are good for the environment.

The basic argument that buying local foods helps the environment is very simple: Buying local reduces the total amount of trucking that goes on in the world. Fewer trucks driving from mega-farms in Indiana to Cambridge, Mass. means reduced carbon emissions, means less global warming and lung cancer, etc., etc.

Pretty simple, right? Perhaps deceptively so.

Let’s think beyond stage one about the full economic consequences. Suppose I, an aspiring-to-be-responsible consumer, have a choice: I can buy an ear of corn that was delivered from an industrial farm in Pennsylvania at my local Foodmaster, or I can buy an ear of corn from a new local farm just around the corner from my apartment in Cambridge, Mass. Which should I buy? Put differently, should I resist the temptation to buy the corn from Pennsylvania, which is cheaper? The corn from Cambridge must be more expensive for some pretty obvious reasons: Cambridge is home to Harvard and MIT, it’s part of the the major dense, metropolitan area of one of the most well-educated parts of the country. So the labor here is very productive, and the land is highly sought after, because employers want to get access to those productive workers, and productive workers want to get access to those clusters of firms. That means rents and property values are high, relative to the rest of the country.

The reason I mention this is that thinking about why the local food is more expensive points to a whole bunch of ripple effects that complicate our picture of “local=good for environment.” The fact that there is now a new farm near my apartment in Cambridge means that something else is no longer there. The farm has displaced some other businesses or residences by out-bidding them for the property. When I pay a premium for corn from Cambridge, a lot of that premium essentially goes to helping that farm recoup its losses for buying expensive property in an expensive part of the country. So that extra money has essentially gone to driving up the demand for property in the Boston area, pushing up the price of property here, and occupying slack supply. The local farm has just displaced something else — whether a business or residences —  which now must be farther from me, and from my desirable and sought-after urban cluster. And that means that this something else now has to travel a longer distance, presumably by carbon-emitting vehicles as well. So have I really reduced my carbon footprint?

It’s unclear. I can even see an argument that buying local food in a high-productivity area is seriously problematic, since agriculture is typically only done on a single floor, whereas service professions can be done in skyscrapers. I.e., by paying a premium for local, Cambridge food, I could be displacing 10 floors worth of health-care consultants for one floor worth of agriculture.

Is this an unrealistic thought experiment? Definitely. Local food advocates don’t actually advocate we actually get our food from farms in Kendall Square. They’d just, in this case, advocate getting them from somewhere in eastern Massachusetts, rather than somewhere in Indiana. But I think if you follow the basic logic of our thought experiment above, we’ll see that this is still problematic.

In brief: If local food is less expensive than non-local food, it will naturally prevail in market competition, because both ordinary savers and conscientious yuppies will prefer it. Local food only becomes a debatable topic when it is more expensive than non-local food. And when local food is more expensive, because of higher land and labor costs, the price difference indicates that the local area is a more productive region than the alternative region. So buying local food is, in a sense, a demand that more agriculture be done in this high-productivity area and less in the low-productivity area. And that is not clearly an environmental good. Putting more agriculture in high-productivity areas displaces other industries, and residences, in ways that force those industries and residents to drive further to their workplaces and delivery stations, etc. By supporting a farm in the suburbs of Boston, you push more people to the exurbs; by supporting a farm in the exurbs, you send little ripples through the whole Massachusetts labor market that maybe pushes more people out to Indiana, a less productive, less dense, less walkable, lesse green state.

***

What shall we do about this? Well, first we should rend our hair and despair of the fact that it’s impossible for us to be really sure of what are actually environmentally responsible decisions. And second, we should support revenue-neutral moves toward greater reliance on emissions taxes. If the environmental harms of emissions were fully priced into the cost of everything we buy, we individual consumers wouldn’t need to worry about any of these calculations. We would just need to demand lower prices. And in that world, if local farms were less costly to society as a whole — in terms of both environmental and non-environmental costs — their produce would prevail in markets. If the produce from Indiana were still worth it, it would win in the market.

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2 thoughts on “The Environmental Economics of Locavorism

  1. “They’d just, in this case, advocate getting them from somewhere in eastern Massachusetts, rather than somewhere in Indiana. But I think if you follow the basic logic of our thought experiment above, we’ll see that this is still problematic.”

    Presuming you interact with the people and businesses zoned in eastern MA as much as those in Indiana (i.e. roughly zero), I don’t see how eastern MA isn’t still the better option.

    You’d also enjoy:
    http://opim.wharton.upenn.edu/~ulrich/documents/ulrich-cycling-enviro-jul06.pdf

  2. Enviro types seem to do an awful lot of preening – looking for ways to characterize their behavior and/or thoughts as morally superior, preferably without much actual sacrifice being required on their part. I think that when locavores focus on nostrums about greenhouse gasses, it’s a reflection of that urge. They should know that to a large extent energy consumption is already priced into most products, simply because energy is so large a share of the cost of almost everything. Your post identifies fine examples of this, but there are many others. All told, when comparing apples to apples (literally) the less expensive apple is likely to be the less energy-intensive apple, regardless of which one came from where. (Just as, when a hybrid car costs more, much of that extra cost represents extra energy consumption in its manufacture and delivery. But I digress.) The enviros’ self-esteem maneuvers to one side, however, there are plenty of reasons to buy local. For one thing, having farmers around helps keep a community sane – they, after all, have daily experience with real work that provides a tangible contribution to our sustenance. For another, farms are nice to look at. Some of us even like the way they smell. And then there’s the fact that fresh-picked corn tastes better – and if it isn’t local, it isn’t fresh-picked.

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