Consumer preferences for food away from home: Dine in versus delivery

Abstract

Food away from home (FAFH) is an integral part of U.S. consumer diets, with food delivery orders becoming more popular in recent years. However, little research has been done on whether choice patterns vary across dining settings and how this might affect the impact food policies such as a red meat tax would have on consumer welfare. We target this gap by implementing a food menu basket-based experiment (FM-BBCE) to determine consumer preferences and demand for FAFH in two dining settings: in-restaurant dining and food delivery. The FM-BBCE approach enables us to (a) identify the substitution and complementarity patterns between various food types (meat vs. plant-based food) and courses (appetizers, main courses, and side dishes), and (b) determine the demand and welfare impact of a red meat tax across the two settings. We find that respondent's orders in the delivery setting are typically higher in calories, and most items act as complements for one another, whereas menu items are substitutes in the dine-in setting. Consumers were generally more price elastic in dine-in versus delivery settings. Sociodemographics influence choice; for example, urban consumers have a higher preference for plant-based meat alternatives than rural or suburban respondents. These sociodemographic differences extend to the welfare effects of a red meat tax that we simulate, which is regressive toward low-income individuals in the delivery setting but not in the dine-in setting. Findings from this study provide new insights on FAFH consumption, which can be used by producers, policymakers, and academics.