The Economics of Veganism

Martha Southall. 23 November 2016.

On 21st March 2016, the Oxford Martin Programme on the Future of Food published the first ever study to look at the health and climate benefits of dietary change. Published in the PNAS, the study showed that our diets could have a huge effect on the global economy.
The study involved modelling four different dietary scenarios for the year 2050; one based on current trends, another based on global dietary requirements and two more as if the population became either vegetarian or vegan.

Health
Springmann’s research showed that, by 2050, 5.1 million deaths could be avoided if we adopted diets within dietary guidelines. Were we vegetarian, 7.3 million lives would be saved and the number would be 8.1 million if we became vegan. Around half of these avoided deaths (particularly in the developed world) were due to a reduction in the diseases associated with red meat consumption such as heart disease, and the other half due to fewer people being overweight through increased fruit and vegetable consumption (mainly in developing regions). 
The USA’s expensive healthcare means that it would gain the most financially from a vegan diet, saving $1billion per year due to fewer working days lost, unpaid informal care and medical expenditure. Interestingly, it has also been said that most of the antibiotics in the US are administered to healthy livestock rather than humans. Widely-adopted veganism could therefore reduce the price of such medicines for US customers because more would become available. Springmann even attempted to quantify the value that society places on the reduced risk of dying which could be up to 13% of global GDP.

The Environment
In 1996 the European Council of environment ministers declared that ‘global average temperatures should not exceed two degrees above pre-industrial level’. The study projects that food-related emissions could account for half of this increase by 2050. One UN study claims that animal agriculture already accounts for 51%. Dr Richard Oppenlander has said that if we ceased to use gas, oil and fuel immediately, the impact of animal agriculture alone would still cause us to exceed the maximum target of greenhouse gas emissions (565 gigatonnes) by 2030. Perhaps the focus of environmental groups has therefore been out of touch with real causes of climate change.
Following global dietary guidelines would cut said emissions by 29%, vegetarianism by 63% and veganism by 70%. This is because of the 10 million tonnes of methane (the most potent greenhouse gas) emitted by flatulence from livestock, as well as the greenhouse gases emitted by forage grown to feed them. 65% of the nitrous oxide emitted is also as the result of animal agriculture. The economic impacts of climate change range from reduced crop yields due to desertification in central Africa to higher UK taxes to treat more skin cancer patients. These findings could therefore be crucial for the future of the global economy.

The impact of animal agriculture extends further than climate change; it accounts for 30% of world water consumption, 45% of land use, 91% of Amazon destruction and is a leading cause of ocean dead zones, habitat destruction and extinction. In the Amazon, nearly 100 new species are lost every day due to deforestation for livestock. David Siman, author of “Meatonomics”, calculated the financial cost of all the externalities (impacts on third parties) associated with animal agriculture from health to cruelty. The resulting cost (around $414 billion), were it to be internalised by firms, would cause the price of animal products to sky rocket. A $5 box of eggs would become $13. In actual fact, it is the taxpayers who are forced to pay these costs as they suffer the effects of animal agriculture. However, governments are unlikely to intervene to internalise these costs due to the large financial influence of farming companies in politics.
In terms of efficiency, an average of 15% more protein can be grown from plant-based sources than from meat on the same area of land. The one billion humans facing starvation every day are therefore worse off. It is the case that in many countries poor citizens work to produce food to rear livestock that only those more wealthy than themselves can afford to buy, serving to increase the inequality gap.
Between the years 1912 and 2012, the global population boomed from 1.5 billion to 7 billion. These trends, coupled with rising incomes in newly-industrialised countries such as China, suggest that demand for meat is unlikely to do anything but rise. Springmann rightly clarified that he did not expect us all to become vegan (this raises its own concerns as an imposed measure), but said ‘adopting healthier and more environmentally sustainable diets can be a large step in the right direction’.

Bibliography:

Analysis and valuation of the health and climate change cobenefits of dietary change, by Marco Springmann, Charles Godfray, Mike Rayner and Peter Scarborough

Cowspiracy: The Sustainability Secret, 2014

Further Reading:

“Meatonomics”, David Siman

“Comfortably Unaware”, Dr Richard Oppenlander

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