Academic journal article The Journal of Consumer Affairs

Do the Poor Pay More for Food? an Analysis of Grocery Store Availability and Food Price Disparities

Academic journal article The Journal of Consumer Affairs

Do the Poor Pay More for Food? an Analysis of Grocery Store Availability and Food Price Disparities

Article excerpt

Do the poor pay more for food? To answer this question, this study was conducted to provide an empirical analysis of grocery store access and prices across inner city and suburban communities within the Minneapolis and St. Paul metropolitan area. The comparison among different types of grocers and geographic areas is drawn from a survey of approximately fifty grocery items for fifty-five stores. Results indicate that the poor pay only slightly more in the Twin Cities grocery market. More significantly, those who shop in non-chain stores pay a significant premium, and the poor have less access to chain stores. This study reveals that the biggest factor contributing to higher grocery costs in poor neighborhoods is that large chain stores, where prices tend to be lower, are not located in these neighborhoods.

Consumer groups have frequently contended that residents in poor, inner-city communities are at a disadvantage in the prices, quality, and quantity of groceries sold in their communities. This contention raises fundamental questions about grocery store access and prices. Do types and sizes of grocery stores located in the innercity differ from suburban neighborhoods? Do different types of grocers charge different prices? Do prices differ depending on location? To examine these questions, this study provides an empirical analysis of grocery store access and prices across inner-city and suburban communities within the Twin Cities--metropolitan area. Like many other midsized metropolitan cities in United States, the inner-city poverty problem in the Twin Cities has become more significant over the past decades. [1]

Across the country, various researchers, community-based organizations, and consumer advocacy groups have examined the question, "Do the poor pay more?" Sexton (1971) summarized several studies about grocery price inequity in poor neighborhoods in the 1 1960s and early 1970s. These studies focused on large cities like New York, Los Angeles, Detroit, Chicago, Philadelphia, and Buffalo. Of the fifteen studies, only five found that consumers in low-income areas were charged more for food products. Based on these results, Sexton concluded that inner-city poor residents did not pay more. However, findings in surveyed studies were generally not complete because of methodological limitations. When prices of products are compared, the same brand and package size should be used. Many studies were found in the survey that either did not ensure these conditions or had too small sample sizes, which limited the statistical significance of their findings. [2] With consideration of these limitations, Kunreuther (1973) exam ined the relative importance of store and package size effects on purchasing decisions and tried to find causes of food price inequality in poor neighborhoods. He found that the average price per ounce declined or remained the same whenever package size increased, and for each of the items, smaller neighborhood grocers stocked relatively fewer large-size items than the chain stores. His findings indicate that because low-income groups tend to shop more frequently in smaller stores compared with middle-income families, poor families pay higher food prices.

More comprehensive studies, with regard to methodology and sample size, have been conducted in the 1980s and 1990s at both national (Finke, Chern, and Fox 1997; MacDonald and Nelson 1991; U.S. House of Representatives Select Committee on Hunger 1990) and regional levels (Alwitt and Donley 1997; Bell and Bell 1993; Citizens Research Education Network et al. 1984; Freedman 1991; Stevens 1995).

In 1991, for example, New York's Consumer Affairs Department compiled a report on grocery store price-fixing in several neighborhoods (Freedman 1991). The report showed the poor paid more for groceries in inner-city neighborhoods, yet they received poorer quality foods and services. The report consisted of price surveys in sixty stores and 140 interviews in various New York neighborhoods. …

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