Economic classification of the proposed law on children’s food advertising

The Children’s Food Advertising Act (KLWG-E) planned by the Federal Ministry of Food and Agriculture aims to protect children under the age of 14 from unhealthy food advertising. It prohibits the advertising of food and beverages to children whose nutritional value exceeds the recommended upper limits. The short study by DIW Econ, commissioned by foodwatch e.V., analyses the economic effects of this law from a macroeconomic perspective.

The study shows that the feared loss of three billion euros in advertising is greatly overestimated, as food manufacturers can adapt their advertising strategy (e.g. by switching to healthier products) and change the formulation of products without cutting the entire advertising budget. Experience from other countries suggests that advertising restrictions can reduce sales of unhealthy foods and thus potentially avoid significant health costs. These findings underline the overall economic benefits of the KLWG-E over and above the supposed loss of advertising expenditure.

Foodwatch e. V. 

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