Publisher: ANNUALREVIEWS; Journal: ARRE: Annual Review of Resource Economics; Copyright: Volume: 3; Issue: 0; Manuscript: 3_McCluskey; Month: ; Year: 2011 DOI: ; TOC Head: ; Section Head: ; Article Type: REVIEW ARTICLE Page 0 of 30 Nutritional Labeling and Consumer Choices Kristin Kiesel, 1 Jill J. McCluskey, 2 and Sofia B. Villas- Boas 3 1 Economics Department, California State University, Sacramento, California 95819; email: kiesel@csus.edu 2 School of Economic Sciences, Washington State University, Pullman, Washington 99164-6210; email: mccluskey@wsu.edu 3 Department of Agricultural and Resource Economics, University of California, Berkeley, California 94720-3310; email: sberto@berkeley.edu Keywords information, food demand, consumer behavior Abstract In 1994, nutritional facts panels became mandatory for processed foods to improve consumer access to nutritional information and to promote healthy food choices. Recent applied work is reviewed here in terms of how consumers value and respond to nutritional labels. We first summarize the health and nutritional links found in the literature and frame this discussion in terms of the obesity policy debate. Second, we discuss several approaches that have been used to empirically investigate consumer responses to nutritional labels: (a) surveys, (b) nonexperimental approaches utilizing revealed preferences, and (c) experiment- based approaches. We conclude with a discussion and suggest avenues of future research. INTRODUCTION How the provision of nutritional information affects consumers’ food choices and whether consumers value nutritional information are particularly pertinent questions in a country where obesity is pervasive. Firms typically have more information about the quality of their products than do consumers, creating a situation of asymmetric information. It is prohibitively costly for most consumers to acquire nutritional information independently of firms. Firms can use this