eli5: How come things like whole wheat flower and brown rice cost more than their processed counterparts?

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It seem really backwards that foods that are processed more cost less. What are the reasons for this?

In: Economics

4 Answers

Anonymous 0 Comments

Some is that lower economies of scale make it more costly to produce more niche products/ingredients. Those that care enough to consume a specialty version also probably want higher quality version, so it’s also a better quality of wheat that’s being chosen for processing as whole wheat. And some of it is marking it up as a premium good because of its supposed benefits vs. the standard version.

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