Health Economics: Obesity Flashcards
Crawley (2015) explains the rate of obesity in 1960 to today in OECD countries?
1960- 15%
Today- 35%
Rate of obesity in the US and UK, according to Crawley (2015)?
USA- 35%
UK- 25%
What does obesity increase the chances of?
Mortality, diabetes, CVD, hypertension, asthma, cancel (Extra insulin)
What can obesity decrease?
Employment opportunities and productivity
What shape are the healthcare costs of obesity in men/women?
Men: U shaped
Women: J shaped
Why is obesity an economic decision?
: Individuals balance utility from current food intake with monetary expense. Disutility is given from future weight gain. Can change this behaviour is Benefits > Costs.
What is an obese BMI?
30+ (Overweight is above 25)
Classes of obesity?
Class 1 > 30
Class 2 > 35
Class 3 > 40
Problems with BMI?
- Doesn’t measure fatness adipose
- Misclassifies average lean mass
Alternatives to BMI?
Waist-hip ratio
% of body fat (bio-electrical impendence)
What does Cutler (2003) say about exercise?
Rates of recreational exercise have increased in the US
How much have calories been said to increase?
220 according to surveys (little data, measurement errors)
Why did Archer (2013) say it is hard to measure calorie intake?
Reporting errors and protocol changes, some people’s reported calorie intake is “not physiologically plausible”.
What is the neoclassical theory of weight?
Weight is a constrained optimisation problem. Utility balance, present bias. Rational choice is to overeat
What is the utility function?
Max: U ( W ( f,s ) ,f ,c ) s.t c+pf=I
Utility, weight, food, exercise, consumption, price, income
When would the ideal weight W0 be chosen?
Chosen if it was costless to obtain and if food gave no utility.
What type of goods are food and exercise?
Normal goods, with a diminishing marginal utility
What shape is the utility curve for weight?
Non-monotonic (inverted U shape)
What does the utility curve balance?
Choice of calories balances weight effect and the joy of eating, against the foregone consumption of alternative goods
What does a reduction in food prices lead to?
Reduced consumption of other goods (increasing Uc)
Increased food consumption (decreasing Uf)
Increases to weight gain
Food prices for 1997 to 2007 examples?
Coke 2L: Down 34.9%
Pizza Hut 12inch: Down 17%
Fresh fruit/veg: Above the rate of inflation
Causes of obesity
Sedentary work, mass food preparation, reduction in food prices, increased consumption
Cutler (2003) change in calorie consumption, 1978 to 1998?
265 + for men
143 + for women
Snacks the major increase
Curie et al (2010) paper on obesity?
If fast food place is within 0.1 miles of the school =+obesity, =+100 calories a day compared to 0.25 miles.
No difference between 0.25 and 0.5 miles.
Ogden, 2010 paper on education and obesity?
Increase in education leads to healthier individuals, more prevalent in women (College, 24%, high school 42%)
Men (27% and 32%)
What did Clark and Royer, 2013, find?
School leaving age change from 14 to 16 had no impact on BMI
What did Brunello, 2013, link with education?
School leaving age changes across Europe. No effect for men. Women 10% extra education, led to a 1.84% lower BMI
How does peer pressure affect obesity?
Fitness for men improves
Weight for women
Yakusheva (2014) paper discovery on peer pressure?
Bandwagon effect discovered in college students. Sharing rooms, link shown of additional weight gain depending on their room shares baseline waistline.
Is weight a normal good?
Higher income: Ambiguous effect on weight
+ if health/ appearance are normal goods
May be a U
How does income affect weight in developed countries?
Low income, increase in income leads to a marginal weight gain. No evidence of this effect in middle income groups
How does income affect weight in richer countries?
Rich countries use more productive tech: income and weight rise. Cannot explain the rise in obesity, should have fallen over time
What did Akee (2013) show about income and BMI?
US tribe, casino payments ($4000) for those with tribal heritage. Study compared those who got 2 v 6 yrs. Small increase in BMI for the poorer families, no difference for the richer ones.
How has women working been linked to obesity?
Women working has lead to rise in obesity. Less time to be spent preparing healthy meals etc but no difference in weight between working and non-working women.
How did Ruhm (2005) link obesity and the economy?
“healthy living in hard times”
1% lower employment = 0.73% lower probability of obesity.
Arkes (2009) obesity link to economy in teen men/women?
Male teens gain weight in strong economic times. Opposite is true for teenage women.
What did Anderson (2003) say about working mothers and obesity?
Time constraints, and poorer food choices expected from working mothers, perhaps less time outside. Casual link found, however restricted to higher social class groups (with lower rates of obesity)
What is Ruhm’s Dual Decision theory (2012)?
2 brain parts, ‘Deliberative’ rational decisions (Pre-fontal cortex). ‘Affective’ system, impulses. Lowers utility for people whose have ‘deliberative’ behaviour
What is a Myopic preference?
Present bias
How does impatience affect obesity?
Impatient individuals consume more and have a higher BMI
Sign effect of discounting explained?
Consequences are discounted at a lower rate than benefits e.g £100 now = £158 but £100 = £133 in a year
What is hyperbolic discounting?
Rates of time preferences are not constant but vary with the time horizon
What is exponential discounting?
Rate of discounting is constant at all delays. £1 today (A) or £3 tomorrow (B) or £1 in a year (A) or £3 in a year and a day (B). Choose either AA or BB
How can tech change be linked with obesity?
Reduces price/time costs associated with consumption. Usual price response (reduced delays affects discounters more!)
Solutions to self control problems?
Gastric bands
Gym membership
Bond for weight loss
What did Phillipson and Posner (1999) predict?
Obesity falls with development, self-limiting rise in obesity. Tech change can reduce costs of food, increase work time and weight may not grow indefinitely as sedentary lifestyle is outpaced by thinness demand
Phillipson and Posner (1999) link between income and weight?
Non-monotonic link to utility, U shaped link between income and weight
Negative relationship between obesity and wages?
- Lowers wages (discrimination/ less productivity)
- Lower wages causes obesity (cheaper foods)
- Time preferences/genetics
Cawley (2004) evidence on obesity and wages
- Weight lowers wages for white women (65 pound + leads to 9% lower wages)
- Black/Hispanic women and no men show no effect
Rooch (2009) evidence on discrimination for obese people?
Used fake job adverts in Sweden, 8% less interviews for obese women, 6% for men
Do all studies link employment and obesity?
Some studies find no effect on employment
Should the government intervene in obesity?
Is it a private problem? Must be evidence of market failure to justify intervention
What is a information deficit?
Free markets under produce public goods such as information
How can governments help with the information deficit?
- Regulate advertising
- Provide government sponsored information
Why might more information not solve the deficit?
Time costly to use information, with many comparisons of goods people have been found to ignore the information
McDonalds advertising budget in comparison to 5 a day promo?
1996 = $599 million
National Cancer Institute, 5 a day promotion = < $1 million
What did Bollinger et al (2011) show about Starbucks calorie information?
Labels reduced Starbucks consumption by nearly 6%, no impact of beverages
Ways governments can intervene due to lack of rationality?
Paternalistic reasons (E.g. ban cigarettes for u18s, incentives for healthy eating) -Dual decision theory links
How does obesity link with externalities?
- Externalities occur if weight gain harms the welfare of other individuals (cost to taxpayer and premiums)
Solutions to externalities from obesity?
Introduce a ‘fat tax’ although its hard to only tax excess calories so will harm the poorest
-Need to account for spill over effects, e.g. quitting smoking can increase calorie intake
Why did Siediell (1995) argue Americans were fatter than Europeans?
- Cheaper food
- More TV
- Lower land prices
- More suburbanized
- Lower gas prices/ more car usage
Forman (2016) examples of modern tech which could help with obesity?
- Fitness trackers (Easier to track)
- Video conferencing with weight control experts (reduce cost/ time/travel)
- Games for weight loss (e.g. wii fit, pokemon go)
- Apps
- Brain training, control training on computers can alter behaviour
Did Chen’s (2014) paper find modern weight loss techniques work?
Mixed results: 6 of 14 studies found BMI in the short-term (video games, e-learning etc)
Dam (2008) other reasons for obesity?
- moral hazard
- role of network
- habitual behaviour
What is the circle of discontent? Marks (2015)?
Health is regulated by homeostasis which maintains equilibrium using feedback optimum functioning of the organism. obesity imbalance is attributed to a ‘Circle of Discontent’, a system of feedback loops linking weight gain, body dissatisfaction, negative affect and over-consumption.
What does Mark (2015) suggest will halt the obesity crisis?
- Stop victim-blaming, stigma and discrimination#
- Remove the thin-ideal
- Reduce consumption of energy-dense, low-nutrient foods
- More plant-based diets.
