Carpe Diem

Chart of the day: As a share of consumer spending, the US has the most affordable food in world

Image Credit: Shutterstock

Image Credit: Shutterstock

This is an update of a Carpe Diem post from last summer that generated almost 100 comments, so it appears again here with new international data for 2011 from the United States Department of Agriculture’s Economic Research Service on household spending for food consumed at home in 84 countries.

Rank 2011 Country % Consumption Spending on Food Consumer Spending per CApita Spending per Capita on Food
1 U.S. 6.7% $33,575 $2,239
2 Singapore 7.4% $18,874 $1,393
3 U.K. 9.4% $23,728 $2,225
4 Canada 9.7% $27,632 $2,688
5 Switzerland 10.2% $45,317 $4,608
6 Ireland 10.2% $22,153 $2,260
7 Australia 10.7% $36,292 $3,880
8 Austria 10.9% $27,479 $2,997
9 Germany 11.1% $23,937 $2,658
10 Denmark 11.2% $28,592 $3,200
11 Netherlands 11.8% $22,148 $2,612
12 Finland 12.0% $25,857 $3,109
13 Qatar 12.3% $13,672 $1,683
14 Sweden 12.4% $26,829 $3,329
15 S. Korea 12.6% $11,961 $1,506
16 Spain 13.0% $19,260 $2,495
17 Taiwan 13.1% $11,720 $1,534
18 Norway 13.1% $37,779 $4,964
19 France 13.3% $24,576 $3,263
20 Hong Kong 13.6% $22,336 $3,027
21 Bahrain 14.1% $6,286 $889
22 Belgium 14.3% $23,768 $3,388
23 Slovenia 14.3% $14,328 $2,054
24 UAE 14.4% $20,837 $3,002
25 Italy 14.6% $22,397 $3,276
26 Japan 14.7% $27,143 $3,988
27 N. Zealand 14.7% $21,714 $3,191
28 Portugal 15.5% $15,036 $2,337
29 Czech Rep. 15.7% $10,612 $1,667
30 Brazil 15.9% $7,573 $1,204
31 Chile 16.3% $7,919 $1,293
32 Israel 17.3% $17,875 $3,099
33 Latvia 17.6% $8,328 $1,468
34 Greece 17.6% $20,329 $3,583
35 Slovakia 17.7% $10,027 $1,774

We hear reports all the time that real household incomes are stagnant or falling, the middle class is disappearing, household wealth has declined, and income inequality is rising. All of those reports might make one think that the standard of living for the average American is bad and getting worse. But here’s one basic measure of a country’s standard of living that shows Americans are better off than their consumer counterparts anywhere in the world: The share of consumption expenditures spent on food consumed at home, see table above of 35 (out of 84 total), ranked from lowest to highest spending on food at home as a share of all consumption expenditures in 2011.

Relative to our total consumer expenditures, Americans have the most affordable food on the planet — only 6.7% of the consumer spending goes to food consumed at home. European countries like Spain, France, Belgium, and Norway spend twice that amount on food as a share of consumer expenditures per person, and consumers in countries like Turkey, China, and Mexico spend three times as much on food as Americans relative to total consumer expenditures (see full list of countries at the link above).

Notice that consumer spending per person in Switzerland ($45,317) is about 35% higher than in America ($33,575), but the Swiss spent about twice as much on food per person in 2011 ($4,608) as Americans ($2,239), so their spending on food (10.2%) was higher than Americans (6.7%). The Greeks spend 60% more on food per person ($3,583) than Americans, and they also spend about 40% less on total consumer expenditures ($20,329) than Americans ($33,575), so the Greeks’ spending on food as a share of consumer expenditures is much higher (17.6%) than in the US.

And by a slightly different measure, the USDA reports (see Table 7) that Americans as a group spent only 5.7% of our disposable income in 2011 on food at home. For those who think that the 1950s were the “golden age of America’s middle class,” it sure wasn’t so great for food affordability – the share of disposable personal income spent on food in the early 1950s was above 17%, and about 14% by the end of the decade, more than twice the 5.7% share in 2011.

For America’s increasingly affordable food over time, which has also been the most affordable in the world as a share of household spending for many years, we can thank the innovation, technological advances, and ever-greater supply-chain and distributional efficiencies that drive America’s farming industry, which in turn drive down food prices relative to other goods and services and relative to our income.

54 thoughts on “Chart of the day: As a share of consumer spending, the US has the most affordable food in world

    • they do? I honestly never saw the difference in quality of food between any of the pantries of my friends houses growing up. It was the quantity of crap like fruit snacks, pop tarts, and pizza rolls. Just because mom can afford to buy tuna steaks and organic eggs doesn’t mean that the american mom wants to take the time to cook the crap. Sure people might cut back on buying ice cream, but going from ben and gerries to the generic brand? cry me a river.

      Ever see those lines at the fast food chains? People are substituting quality for ease, not price.

  1. I guess it says that the US can afford to buy and eat a lot of food – and we DO just that!

    Add another column – percent obese

    • I’d agree with that. This table points to the industrialization of the food supply and degradation of food quality, which are significant factors in the rise of obesity and other health issues. We eat cheap food like corn and soy, and we get sick from it. I read somewhere that up to 15% of the calories consumed in the US come from Soy.

      We could probably cut our healthcare costs in half if we ate more like the Swiss or French. Pay now, or pay later. Personally, I’m paying now. Pass the butter!

      • the problem is that when people smoke or overeat and get obese – if the insurance rates go up – then they opt out of insurance and let taxpayers pick up the tab.

        • Well of course. With guaranteed coverage for pre-existing conditions, none of us will ever need to buy insurance again until we get sick.

  2. Wow, that is not a lot of money spent on food, a little less than $200/month. When I lived extremely cheaply some time back, I never ate out and would spend $150/month, which I though was very little. I guess I could have gone even lower if necessary, below $100/month I figure. But it’s kind of amazing that the average is below $200/month, which is not that much.

    What is it about Americans that they have the fourth-highest consumption spending in this list, yet spend so little on food? For a comparison, when I was making more money, I upped my food spending to $500+ a month and that was still a lot of local sandwich and pizza places, hardly Ruth’s Chris every night. ;) So you can really blow out your food spending if you wanted to, I’m surprised that food spending is this low… or are the numbers inaccurate?

      • This seems like a major point of confusion to me. Americans eat out a lot so comparing in-home food costs is likely to be really misleading.

        • that seems like a fair criticism.

          if americans eat out more (and i’m not sure if and to what extent that is true) then that would certainly skew this some.

          i also wonder, why use household consumption as opposed to household income?

          that seems like an even bigger issue as the US has very a very low savings rate compared to many countries.

          “affordable” seems like it ought to be based on income, not spending.

          if two people both earn $50k and spend $k a year on food, why would we call food “more affordable” for the guy who saved no money in comparison to the one who saved $10k?

          that does not seem to make any sense.

          mark posted the DPI figure for the US, but not for any of the other countries, so we cannot compare them.

          the first chart may be showing lower US savings rates as much as it is food prices.

    • I am having trouble with the numbers. We just got back from Florida and found the cost of fruit and vegetables in the Florida and Georgia to be more expensive than in Southern Ontario, which is where we live. Given the fact that my family of four spends close to $200 a month on fruits and vegetables I cannot see how the figures are valid. Unless people mainly eat grits, bread, and other low nutrition content food there is no way that a family can leave as cheaply as is being claimed.

      • Note that this chart is per capita, ie per person, so it goes up to $800/month for a family of four, I’m guessing. I now notice that my link was for household spending, whereas my own expenditures were for one person, so these stats still seem low to me. I guess actual stats on food spending outside the home would give a complete picture.

        • Note that this chart is per capita, ie per person, so it goes up to $800/month for a family of four, I’m guessing. I now notice that my link was for household spending, whereas my own expenditures were for one person, so these stats still seem low to me. I guess actual stats on food spending outside the home would give a complete picture.

          The $800 makes a lot more sense but still seems very low to me. I drop nearly $10K each year just at COSTCO and nearly $3K a year on coffee. Add to that around $200 on fresh fruits and vegetables, about the same on frozen fruit for the kids’ smoothies and I still can’t understand why the numbers are as low as they are. All I know from personal experience was that apples, lettuce, green onions, and other fresh fruits and vegetables tended to cost me around 25%-35% more in Florida and Georgia than they cost me in Southern Ontario. While some of the fast food joints were a bit cheaper people seem to order more than what I am used to at home. A regular coffee in NY City meant three sugars and three cream. Back home it means one of each. Fresh fish were about the same price as they were back home and I did not see a major difference in prices for decent cuts of meat. The same is true when I go camping in New York state. While gasoline, tires, and booze are cheaper and electronics tends to be a lot cheaper the food isn’t. Perhaps I just know where to shop where I live but I can’t see that much of a difference in the higher end grocery stores. Where Canadians get killed are the regulatory monopolies like milk, cheese, chicken, turkey, etc.

          • i am having some serious issues getting these numbers to add up.

            if the US has per capita household spending of $33.6k and has 2.6 people (per 2010 census) then we are looking at $87.3k in spending per household which is dramatically above household income which is about $51k.

            we may be getting into some issues with median vs average here, but this seems like much too big a difference to be just that.

            how are households spending 70% more than their income?

          • i am having some serious issues getting these numbers to add up.

            I think that the numbers contain many errors and uncertainties and are processed using methods that are not all that useful. That makes me look, smile, and move on without taking them all that seriously.

            When I think about it a number of issues pop up about using aggregates. It is obvious that food is more expensive in Canada than in the US. But there are some areas in Canada where there is such a huge population base, such competition, and such a good distribution system that food is cheaper than in most of the place in the US. From what I have seen food in Toronto seems cheaper than food in NY City or Boston. But it is also cheaper than areas that are a few miles north of the city. I think that the variation is so high that making a proper weighted comparison is somewhat useless. Add to that the fact that the area has about half of the people who live there being born in a different country and has very different diets and the statistics folks cannot really tell us as much as they seem to think. Even within my own family there is a huge variation. My Chinese wife likes to eat very differently than my Italian sister-in-law. My brother has a typically Western taste with a bit of Western Mediterranean thrown in while I tend to favour Central Asian and Eastern Mediterranean cuisine. My typical food purchases will include fruits and vegetables that most Americans have never tasted and I have patiently had to explain what some of the foods were to people who have wondered into one of my favourite supermarkets. Frankly, I doubt that the statisticians are keeping good track of the prices of such goods or get as much good data as they think given the massive underground economy that hides revenues from the tax department.

            All aggregate numbers are deceiving even if the people putting them together mean well. That is why I do not pay much attention to most of the reports that come from the government.

          • Table 13 has 2011 spending for food at home and away at a per capita of $4229 per year ($11.59 per day). Sounds about right to me.

            http://www.ers.usda.gov/data-products/food-expenditures.aspx#26654

            It does? What do you get for $11.59 per day? I know that even my kids eat more than that and they do not have the same Starbucks addiction that inflicts me. Does that figure take into account the pop, coffee, beer, chocolate bars, etc., that are purchased outside the home? Does it include the lunch subsidies? I am sorry but I have seen Americans eat and do not buy the numbers unless you are telling me that there are millions who live off grits, fish they catch, animals that they hunt or raise, and fruits and vegetables that they grow. But if you do not count that food shouldn’t you count the expenses incurred to catch, kill, or grow that food?

          • v-

            if you are spending $9 a day on coffee, then i suspect you are mostly buying it out at places like pete’s/starbux/etc.

            (or else you are drinking over a half a pound of really good beans a day, which seems unlikely)

            these figures would not include that as that would be food away from home.

          • It does? What do you get for $11.59 per day?

            Table 13: $4229/365 days per year = $11.59

            Year, Population, Food Home, Food Away, Total Food (per Capita)

            2011 311.592 2,171 2,058 4,229

          • $3,000 a year for coffee, Vange! I spend about $150 a year for a can of Folger’s coffee at $8.28 every 3 weeks, and we drink a lot of coffee (40 cents per day).

            I was spending $1.89 four days a week for take-out coffee for my 30-mile drive home from teaching school at 10 pm, but I got cheap and took my old coffee pot to work and make some before I leave now.

          • I do the same for Folgers. But I also like to have a cup or two at Starbucks, Panera, or whatever place I go to sit and read my books. When the kids come along, which is four or five times a week they have their Jones Soda or whatever mineral water they like. I figure that I spend close to $10 a day for coffee and drinks for the kids. I know many people who start their day with a latte and a muffin at Starbucks, have a cup at lunch and one on the drive or train ride from work. That all adds up.

          • i’m not sure that’s the right way to look at it.

            we tend to look at median as opposed to average household income precisely to avoid a massive skew upwards by the very wealthy.

            US median household income is about $51k, a far lower number than the average you are using.

            there are 2.6 people per household. that makes per capita median income $19.6k making food at home more like 12% of income and food at home and out more like 20%.

            this comes down to some methodological choices. personally, i think the median figure is going to be a better measure of typical affordability.

            i doubt i spend 2% of my income on food including eating out. this is just a fact of increasing income. you only need so much food.

            in an average based model with 100 people, adding me would make food look more affordable for everyone else whereas a median based model would shift very little.

            i think that makes it a better method for looking at somehting like “affordability”.

            i think the way you are looking at this data skews it badly away from the typical experience.

            i have no idea whether and to what extent using median data would change these rankings, but i think using median DPI instead of average consumption would be a better measure of “affordability” particularly across nations.

            your methodology also makes a high savings rate make food look more expensive. affordable, at least to my mind, would seem to be related to income, not consumption.

            if i earn $50k and you earn $60k and you save $20k and i save nothing, if we are both paying the same food prices (10k), why would we call them “more affordable” to me?

            sure, they are a larger % of your consumption than mine, but less of your income, which seems to me to be the better gauge here.

  3. Any way to see if there may be a possible correlation between cheap food and the “overweight/obesity crisis” which the elites get so upset about? Isn’t cracking down on obesity really just getting upset when people consume more than they need? What more proof do you want they are failing to live up to communistic ideals?

    • I think a stronger correlation exists between our sedentary lifestyle and obesity, but, to your point, cheap fast food isn’t helping….

      • I would contend that an active lifestyle stimulates the appetite, leading to more overeating. It’s really hard to prevent the body from eating when there is food available, and it is more than at any time in human history.

        Anyway, my point is that the reaction against obesity seems to be a moral one, whereas the causes are more economic. If that’s the case, the whole campaign against obesity is as likely to succeed as King Canute ordering the tide to halt.

        • dan-

          as someone who has been a serious athlete most of his life and has done some extensive study on nutrition and metabolism, i can tell you that you are dead wrong on activity leading to over eating.

          it may lead to more eating, but that is not the same as over eating. activity burns calories. how many you put back in determines changes in weight.

          “over” eating is caused far more by inactivity. it tends to drive insulin levels up as your body is not producing the glucagon you use when exercising in sufficient amounts. add some high glycemic foods, and you wind up hungy.

          drink a coke and sit on the couch, you’ll be hungry from the insulin surge. drink a coke and go for a run, this will not happen.

          the type of food available makes a big, big difference. the US has very sweet food relative to the rest of the world. we use lots of HFCS instead of sugar which really jacks up our glycemic load as does the enriched flour we use that has potato starch in it. combine that with inactivity and people overeat and wind up diabetic.

          campaigns against obesity can only work as education. most people have almost no understanding of nutrition and how foods, hunger, and activity work.

          your comment about being active leading to overeating is a classic example. i mean, seriously, look around you. is it the active people you know that are getting fat while the sedentary stay lean? i doubt it.

          we can give people tools to make informed choices, but making them is up to them.

          personally, i think insurance companies ought to be allowed to charge more for health insurance for fat people. they have higher risk, why not treat them like a high risk driver and charge more? you can charge a smoker more, but not someone fat? seems odd to me.

  4. household spending.. right? spending done by the household … right?

    does that mean only in the house or does it mean money spend by the household for food – anywhere?

  5. Except that in many countries you have entire expense categories that don’t exist and have cheaper substitutes (e.g. owning cars and having dirt cheap mass transit). That makes the comparison null and void for places like Singapore and Taiwan.

  6. Gallup Poll
    August 2, 2012

    “Americans report spending $151 on food per week on average.

    The average $151…is down from the inflation-adjusted $157 to $214 range Gallup found throughout the mid – to late 1980s.

    Adjusting the historical data to 2012 dollars also reveals that Americans’ weekly spending on food began to decline in the 1970s, after rising to a high of $234 in 1966 and 1967.

    Young adults’ average weekly food spending is $173, more than what older Americans say they spend.

    Those with incomes of $75,000 or more per year are averaging $180 per week, compared with $144 for those with incomes of $30,000 to $74,999, and $127 for the lowest income group.

    Men spend slightly more than women

    Young adults and those with higher incomes currently spend the most on food and are most likely to say they ate out “last night.””

  7. Hmm, how about factoring in the approx $150 billion USDA annual budget? About 70% of that budget goes towards the food stamp program. Is this factoring the nearly 50 million people who automatically get their EBT card recharged each month?

    Also, consider all those rural subsidies that keep Benji awake at night. Eliminate them and the price of food would go up.

    • Paul,

      As the footnote to the data show, food stamps are included for food-at-home. The 2011 data show 6.2% at home and 5.1% away from home for a combined total 11.3% of disposable income.

      “1 Food-at-home includes cash purchases from grocery stores and other retail outlets, including purchases with food stamps and WIC vouchers and food produced and consumed on farms (valued at farm prices), but excludes government-donated foods..

      I am at 21.13% average for total food for the last 6 months, but that includes toiletries and anything else from the grocery store except pet food and medicine. I have almost no vehicle expenses other than gasoline and insurance. When one of my budget categories gets smaller by dollars, the other ones get bigger percentagewise.

  8. I am puzzled at this post.

    The most subsidized, regulated, pink, knock-kneed protected sector of the USA economy is agriculture. Not only is agriculture directly subsidized and protected, it is indirectly subsided through huge federal subsidies for rural infrastructure, in water, power, and transportation systems.

    Our food may be the cheapest on Earth—unless you look at the taxes and other costs you absorb to get there.

    • ben-

      while i certainly agree that agriculture is far too heavily affected by government policy, but i’m not so sure it’s a foregone conclusion that this makes it cheaper. ethanol has made it more expensive. so have things like sugar and fruit tariffs.

      i also have serious doubts it is the most subsidized and protected sector.

      health care is certainly worse. medicare part b provides a subsidy orders of magnitude larger. at this point, mortgages are worse as well, and both pale beside of alt energy.

      this does not in any way defend our ag policy, but i do not think you can call it the most subsidized.

  9. Although the average real cost of food Americans spend each week fell from $234 in 1967 to $151 in 2012, real household income, since 1967, has increased. Chart:

    http://www.advisorperspectives.com/dshort/charts/census/household-income.html?household-incomes-mean-real.gif

    Compared to Europeans, Americans live in bigger houses, drive bigger autos, have many more shopping malls, etc. (Americans spend 70% of GDP on consumption compared to 60% in Europe, and in the mid-2000s, when the country was at full employment, the U.S. consumed up to $800 billion a year more than it produced in the global economy).

  10. Consumption inequality and income inequality in the states have risen by nearly the same amount between 1980 and 2010. So although the AVERAGE proportion of consumption spending on food in the US may be lower than in other countries, this result may not hold if one tries to account for consumption inequality (by, perhaps, comparing consumption at the median and lower consumption percentiles).

    Source: http://www.nber.org/papers/w17982

    Also, I agree that the dollar and, particularly, agricultural subsidies play a significant role.

    • I’ve been saying (and back up by Milton Friedman) that we spend what we do on health care because we can. Cheap food is one MAJOR reason.

  11. The picture is hilarious. I’d love to see one with REAL American food, like double-stuffed Oreos, 10 kinds of Doritoes, Twinkies, Cheetos, donuts, moon pies, pork rinds…

  12. somehow the food shown on the picture doesn’t look like a cheap food, doesn’t look like what “regular Americans” buy in the supermarkets.

  13. Is there a material change in this when the prices Americans pay for food is adjusted for government agricultural price supports?

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