In 2015, Starbucks launched its Community Store Program, an initiative aiming to open stores in disadvantaged neighborhoods. Then, in 2020, the company announced that it would expand the program and open 100 stores in underrepresented neighborhoods across the United States. The new stores would bring economic opportunities to lower-income neighborhoods and provide jobs for local residents. These opportunities would facilitate local economic growth and reduce the wealth gap in the long run. Besides these hopeful economic promises, the initiative provides a significant leap toward food access equality in the U.S.

Although malnutrition is less prevalent in the U.S. than in the developing world, urban American neighborhoods still have unequal food accessibility. This is a serious but often neglected issue. In Los Angeles County, Santa Monica and West Hollywood offer a variety of food choices. One can find cuisines from all over the world. Even restaurants offering the same type of cuisine each design dishes with unique flavors to accommodate consumers’ diverse demands. On the contrary, in South Los Angeles, it is difficult to find dining options other than fast-food restaurants. In fact, over one-third of the population in South L.A. lives more than a mile away from a supermarket

“Food deserts”–urban areas with limited food choices and extremely high prices for healthy food–exist in many American cities, not just L.A. Neighborhoods with high poverty rates are more likely to become food deserts. Baker et al. (2006) document that the urban poor in the U.S. often fail to meet the recommended dietary intake because there are not enough healthy food choices in their neighborhoods. As noted by Bower et al. (2014), poor neighborhoods usually have fewer supermarkets and more fast-food restaurants and small grocery stores selling primarily junk food. Among the limited healthy alternatives, if any, many are unaffordable to low-income consumers. An unhealthy diet increases risk for diseases such as diabetes and obesity and poor people typically receive inferior healthcare services–a double shock. This makes a well-balanced diet imperative for those living with limited means.

It remains under debate whether food deserts are a supply-side or demand-side problem. High-quality restaurants are unwilling to launch in poor neighborhoods because they make less profit due to the limited purchasing power of local consumers. The investment would also be risky if the neighborhood has high crime rates. In contrast, Allcott et al. (2018) argue that food businesses avoid low-income neighborhoods mainly because of the low demand for healthy food (i.e. poor people actively choose not to eat healthily). They find that nutrition inequality declines by merely 9% when healthy products are available in poor neighborhoods at affordable prices. 

One root cause of food deserts is the inequality of access to public transit. Public transit affects both the supply and demand of food in cities. Even though many Americans commute by car, restaurants and supermarkets tend to be located close to major public transit stations. This helps retailers attract more consumers at the margin (e.g. passers-by looking for food). On the flip side, sellers are less incentivized to run their business in neighborhoods far from major public transit. On the demand side, if public transit is convenient and fast, consumers in food deserts can easily move to farther neighborhoods for healthier food. This would lead to a new spatial equilibrium in the urban food market. 

Poorer people are more likely to ride public transit, so public transit has a significant impact on low-income consumers’ food choices. Richer households usually own cars and can use rideshare apps like Uber and Lyft. These convenient transportation methods allow them to unbundle where they live and what they eat. They can access a variety of dining options even while living in neighborhoods with scarce food choices. Unlike the middle and upper classes, low-income households are less likely to own cars and usually cannot afford Ubers or Lyfts. Studies have shown that the AI algorithms of ridesharing companies send fewer cars to low-income neighborhoods and charge them higher prices. The lack of accessibility to other means of transportation forces poor people to rely on public transit. As Glaeser, Kahn, and Rappaport (2007) document, poor people urbanize to take advantage of better access to public transit. Ideally, public transit, although slower, could help poor people escape local food deserts by enabling them to travel longer distances. They may take a thirty-minute bus ride to a supermarket five miles away that offers healthy food, a journey most would not make on foot.

Unfortunately, American public transportation is failing low-income communities. Racial and class inequalities are entrenched in the urban public transit system. Transit agencies offer different services contingent on whether a transit route serves mainly “dependent riders” or “choice riders.” Poor people have inelastic demand for public transit, so transit agencies expect them to be less picky about service quality. Therefore, bus lines that go through low-income neighborhoods are poorly maintained and more likely to be delayed. Plus, bus drivers sometimes detour from low-income neighborhoods for safety concerns, which makes it even harder for poor people to ride buses. Although transit agencies also offer premium transit modes such as express commuter buses, these services cater to the needs of wealthier riders and usually do not stop near the neighborhoods where minority groups live. 

Long and irregular waiting times for buses disincentivize poor people from traveling farther to get healthier food. As Miyauchi, Nakajima, and Redding (2021) have found, people’s willingness to make consumption trips (i.e. not commute to work or school) declines as travel time increases. This leads to the concentration of consumption activities in local areas. Their findings imply that low-income people simply eat the unhealthy food readily available in their own neighborhoods.

Fundamental reform of the public transit system is necessary to reduce urban nutritional inequalities. The bipartisan infrastructure bill passed in 2021 includes $89.9 billion to upgrade public transit in the next five years. These funds will be used to invest in more efficient vehicles and expand the coverage of the current transit system. If a new efficient and reliable bus line connects a food desert neighborhood to a nearby subway line, more low-income people can purchase food outside of the area they reside. As travel speed increases, the opportunity cost of getting healthy food decreases.  

Meanwhile, the accessibility to public transit could reduce the number of urban food deserts. Due to the lack of existing healthy restaurants, potential food providers do not have sufficient historical data to predict the future profitability of opening health-conscious restaurants in poorer neighborhoods. A key question is why low-income people do not purchase healthy food. Is it a lack of access or a lack of desire? Opening a new restaurant requires high fixed costs, so risk-averse business owners are not incentivized to open healthy restaurants in low-income areas without knowing the answer. This has contributed to the formation of food deserts.

Restaurants do not have to rely solely on local consumers if public transit is efficient. Consumers from nearby neighborhoods would be willing to travel for food if direct bus lines connected their low-income neighborhoods to other parts of the city and restaurants offering high-quality dining at reasonable prices. Additionally, restaurants located near public transit are more likely to attract commuters looking for a meal. The broader coverage of public transit thus enables restaurants to unbundle where they locate from where their potential consumers live. This ensures that they could still make profits even if local demand is not high. Faced with lower demand-side risks, businesses would consider opening healthy restaurants in lower-income neighborhoods. In this way, they can economize on rents without losing revenues, since commercial rents are lower in neighborhoods with fewer amenities

Innovating public transit infrastructure is an arduous task in need of collaboration. The public sector alone in the U.S. is slow in delivering services. The active engagement of private actors could accelerate the reform of the transit system. In 2016, New Balance built a transit station near its newly opened store in Boston rather than waiting for the local public transit agency. It then partnered with the agency to redirect some metro lines to the station. This station significantly boosted the sales of this new store. Similar public-private partnerships could be formed to bring more healthy restaurants into food deserts. High-quality restaurants can jointly invest in a transit station close to the poor neighborhoods where they are located. They can then persuade the local transit agency to redirect bus lines to that station. In this way, these restaurants can provide social goods by improving low-income people’s access to public transit. They could also provide employment opportunities for locals in low-income neighborhoods–just as Starbucks has done with its Community Store Program.  

Public transit is a solution to the problem of food deserts, but it is unlikely to work on its own. Even if more consumers can conveniently get to restaurants in poor neighborhoods, would they be willing to dine in these neighborhoods with fewer amenities? If not, healthy restaurants may still choose not to operate in these neighborhoods. Even if more healthy restaurants open in low-income neighborhoods, would this cause gentrification and push poor people out into another food desert? These are important considerations for policymakers going forward.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.