Skip to main content
True Cost Accounting (TCA)

06 Jun. 2023

Full-cost accounting and redefining the cost of food: Implications for agricultural economics research

Joachim von Braun

Sheryl L. Hendriks

share this

Food systems have significant externalities that are not reflected in market prices. A first step to correct parts of these externalities is to make them transparent through “true-” or full-cost accounting. Estimates of the external health and environmental costs of food systems at a global level suggest that they may be about two times larger than food valued at market prices, that is, about 20 trillion US$ of externalities versus 9 trillion US$ of food value in the markets. The agricultural economics profession is challenged to move the true cost research agenda forward by identifying realistic pathways for internalizing some of the large food system externalities. Moving from true cost accounting (TCA) to policy action needs to involve citizens and policy-making bodies because internalizing externalities requires buy-in. This relates for instance, to policy instruments such as product labeling, nudging, and differential taxes and subsidies to incentivize healthy diets and disincentivize food waste. Agricultural economics will need to accompany the implementation of any true cost approaches with scrutiny in terms of the efficiency, welfare, ecological, and distributional effects of such policies.

Cookies Settings

FOODCost Project may use cookies to memorise the data you use when logging to FOOCoST website, gather statistics to optimise the functionality of the website and to carry out marketing campaigns based on your interests.

They allow you to browse the website and use its applications as well as to access secure areas of the website. Without these cookies, the services you have requested cannot be provided.
These cookies are necessary to allow the main functionality of the website and they are activated automatically when you enter this website. They store user preferences for site usage so that you do not need to reconfigure the site each time you visit it.
These cookies direct advertising according to the interests of each user so as to direct advertising campaigns, taking into account the tastes of users, and they also limit the number of times you see the ad, helping to measure the effectiveness of advertising and the success of the website organisation.

Required cookies The cookies allow to customize the commercial offers that are presented to you, considering your interests. They can be our own or third party cookies. Please, be advised that, even if you do not accept these cookies, you will receive commercial offers, but do not match your preferences.

Functional Cookies The cookies offer you a more complete and personalised experience, allowing to safe preferences, showing you relevant content to your liking and send you alerts you have requested.

Advertising Cookies These cookies are necessary to allow the main functionality of the website and they are activated automatically when you enter this website. They store user preferences for site usage so that you do not need to reconfigure the site each time you visit it.