I don't know the economics of it, but based on my current knowledge, I think the safest bet is refraining from consuming animal products as much as possible, and then buying the most humane products when necessary.
On the other hand, some people are making arguments that the production of plant based foods actually harms more animals than the production of, say, beef. I just stumbled across this
I ended up reading this article about animal suffering by this Christian apologist called William Craig. Forgive the source, please.
He continues the argument here.
How decent do you think this argument is? I don't know where to look to evaluate the core claim, as I know very little neuroscience myself. I'm quite concerned about animal suffering, and choose to be vegetarian largely on the basis of that concern. How much should my decision on that be affected by this argument?
EDIT: David_Gerard wins by doing the basic Google search that I neglected. It seems that the argument is flawed. Particularly, animals apart from primates have pre-frontal cortexes.