Global food systems generate a wide range of socio-economic externalities, both positive and negative, that vary across regions, value chains, and production contexts. These include positive effects such as job creation and community development, but also negative outcomes such as unfair labour practices and child labour. Yet, these costs and benefits are rarely reflected in the market price of food. To design food systems that are truly sustainable, equitable, and resilient, we must make these hidden costs visible and act upon them.
The Global Alliance for Improved Nutrition (GAIN), Netherlands Food Partnership (NFP), True Price Foundation, Access to Nutrition Initiative (ATNI), Virginia Tech, and Cornell University, have undertaken a landmark three-part review series on True Cost Assessment (TCA). Their ork examines how current methods measure and monetize the impacts of food systems across health, environmental, and socio-economic dimensions. It also contributes to a broader initiative aimed at determining the True Cost and True Price of both observed (currently consumed) and recommended (based on dietary guidelines) food baskets in countries including the Netherlands and two low- and middle-income countries. Building on the True Price Method, the partners seek to refine tools to comprehensively assess health, environmental, and socio-economic externalities, while also considering nutritional value and affordability.
So what Is True Cost Accounting?
True Cost Accounting (TCA) is a systems approach that measures the full range of positive and negative impacts of agri-food systems; its environmental, health, and socio-economic aspects. Unlike traditional financial accounting, which overlooks hidden externalities, TCA provides a holistic view of food’s real impact on people and the planet. Building on TCA principles, True Pricing integrates these quantified externalities directly into retail prices. The resulting “true prices” reflect the complete value of food, which includes internal costs (i.e . production, processing, and distribution) and external costs (i.e environmental degradation, labour exploitation, and health burdens).
Key findings from the Review Series
This review series has analyzed 24 studies (2008–2025) assessing the socio-economic impacts of food systems and revealed that TCA methods in this area remain nascent. Most studies focus narrowly on negative externalities, individual food commodities, and early production stages. They use heterogeneous and largely reactive, bottom-up approaches, with data limitations being reported in over 70% of cases.
Some of the main gaps identified are, weak and inconsistent methodologies with limited standardization; reactive approaches that estimate costs after damage rather than prevention; and limited use of rights-based frameworks that address inequality and dignity. There are also significant data constraints across regions and value chains.
All in all, future research must therefore prioritize methodological development and validation across diverse contexts, while also engaging with the ethical dimensions of monetizing social impacts, especially those related to human rights and power imbalances.
Stronger, standardized methods will generate more comparable evidence on the true value of food, supporting informed decisions by policymakers, investors, and food-system actors.
Insights Across Three Domains
1. Health Impacts : Diet-related diseases including undernutrition, micronutrient deficiencies, overweight, and obesity account for the largest share of food system externalities, costing trillions annually in lost productivity and premature deaths.
The health review maps methods for assessing how foods and diets contribute to malnutrition and non-communicable diseases, and how these can be expressed in economic terms.
2. Environmental Impacts : Agriculture drives up to 30% of global greenhouse gas emissions, 70% of freshwater use, and is the leading cause of deforestation and biodiversity loss. The environmental review identifies frameworks that monetize these externalities, converting impacts such as emissions, water use, and land degradation into economic values.
3. Socio-Economic Impacts : More than 1 billion people depend on food systems for their livelihoods, yet many face low wages, unsafe working conditions, and inequality. The socio-economic review highlights how methods to quantify and monetize these impacts can inform fairer, more inclusive, and resilient food systems.
Why It Matters
This review series shows that while True Cost Assessment and True Pricing are gaining traction, current methods remain fragmented and lack transparency. Without better tools, decision-makers risk underestimating the full scale of food-related externalities, which are estimated at over USD 11 trillion annually, exceeding the GDP of major economies.
This work reveals where evidence is the strongest, where gaps persist, and what future research must address to make TCA a credible, actionable tool for system transformation.
Key Takeaways
Global food system externalities exceed USD 11 trillion per year.
Health costs are the largest share, but environmental and social costs are also significant.
Few TCA methods have been applied in low- and middle-income countries.
Fragmented and inconsistent methodologies limit comparability.
Stronger data systems, interdisciplinary research, and participatory approaches are essential to scale up TCA as a practical tool for decision-making.
A Call to Action
Revealing the true cost of food is a call to action for researchers, policymakers, businesses, and civil society to work towards food systems that are fairer, healthier and more sustainable. Improved methodologies and data will help ensure that the real costs and benefits of our food choices are recognized, driving transformative change for people, planet, and prosperity.