July 21, 2016

Can Changing Economic Factors Explain the Rise in Obesity?

A recently published article in the Southern Economic Journal examines the effects of economic variables on the upward trend of obesity in the United States. Co-authored by Batten School Professor Christopher Ruhm, Charles Courtemanche of the Georgia State University Andrew Young School of Policy Studies, Joshua Pinkston of the University of Louisville College of Business and George Wehby of the University of Iowa College of Public Health, the paper builds a more comprehensive economic model of body weight.

The authors built this new model by combining data from the 1990–2010 Behavioral Risk Factor Surveillance System with 27 state-level variables related to general economic conditions, labor supply, and the monetary or time costs of calorie intake, physical activity and cigarette smoking. Examples of these variables include the price of fast food, food stamps, work hours, gasoline prices, restaurants and urban sprawl.

They found that changes in economic factors collectively explain 37% of the rise in body mass index and 43% of the increase in obesity. Variables related to the costs of eating—particularly supercenter/warehouse club expansion and increasing numbers of restaurants—are the leading drivers of the results.

The authors conclude that future research should continue to evaluate the appropriate role of public policy in light of an economic explanation for the rise in obesity. Economic trends that may contribute to obesity bring substantial benefits to consumers through added convenience and greater purchasing power. They do not advocate reversing these trends to improve social welfare. Nevertheless, the authors found that there are possible economic rationales for intervention.

First, if current agricultural or commercial policies subsidize unhealthy foods, changes in policies to remove these price advantages are desirable. Second, beyond “leveling the playing field” in this way, further interventions might be considered related to the caloric content of different foods and the negative externalities from pooled health care costs.

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