The Economics of Eating Local

Photo by David Luttrell

One of the biggest arguments people make in favor of eating local is that it helps the local economy. But does it?

A 2008 study by the Ochs Center in Chattanooga says that if consumers in Chattanooga’s 100-mile foodshed were to purchase just 5 percent more of their beef, eggs, dairy, and fresh fruits and vegetables from local sources, “it could mean as much as $30 million increased spending in the regional economy.”

As the food production and consumption statistics are similar for the Chattanooga and Knoxville local foodsheds, could a concerted effort to buy local produce to have a big impact on the local economy?

Probably not, says Matt Murray, a professor of economics at the University of Tennessee.

“It would be really hard to argue that this ‘buy local food’ movement has an economic impact. It’s really more of a quality issue, or a diversity issue.”

Murray points out that while buying produce from local farmers does ensure 100 percent of your purchase price goes to someone local, spending less money on produce at a supermarket gives you more money to spend on other things in the local economy.

“If I spend $5 more on heirloom tomatoes at the farmers’ market, that’s $5 less that I can spend elsewhere,” Murray says. “It’s hard to see how that produces a significant net in the local economy.”

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