Price Premiums for Sustainability Claims: Evidence From U.S. Food and Beverage Markets

ABSTRACT

As sustainability claims proliferate on food packaging, understanding their implicit market value is important for effective policy design and competitive firm strategy. This study quantifies the price premiums of sustainability attributes in the U.S. market using product‐level data. We analyze 210,515 food and beverage product launches from the Mintel Global New Products Database (2012–2024) and document a near‐doubling in the prevalence of sustainability claims, rising from 18% of new products in 2012 to 37% in 2024. Using a hedonic price model, we present significant price premiums for both environmental (7.9%) and social (3.5%) claims. Further decomposition reveals substantial heterogeneity, with “downstream” attributes related to disposal (e.g., biodegradable) generating the highest premiums, outperforming “upstream” production claims. Additionally, premiums vary widely across product categories, with large premiums in beverages, but zero or negative premiums in several utilitarian categories such as Sauces and Seasonings. These findings inform ongoing policy discussions on third‐party certification, standardized claim definitions, and disclosure requirements for sustainability claims.