The Economics of Obesity: Is Public Policy Justified

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The Economics of ObesityIs Public Policy
Justified
March 11-12, 2004
Policy and Research Challenges
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• Epidemic of Overweight
• and Obesity in the United States
• We are set up for this to happen
• We lead more sedentary lives
• We think bigger is better
• Food is ubiquitous and cheap
• We feel guilty when we dont clean our plates
• We were misled about the value of low-fat foods
•  

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Consumers Evolution?

Long term cumulative effect?
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Policy and Research Challenges
Is there a public interest in having a large
part of the population obese? YES health
care costs do cost tax payers - healthy people
are or productive - insurance model doesnt
work here Costs Benefits ---how to measure?
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• Annual Costs Associated with the Unsafe
  Consumption of Food, U.S., 2000-2003
• Type of Health
• Care Problem Health Care Costs Deaths
• Microbial 6.9- 33 billion
  2,654-5,000
• Antibiotic resis-
• tant infections 30 billion NA
• Obesity 93 - 230 billion 300,000
  
• Ratio of Obesity costs to Microbial costs
• 93,000/6.9 13.5
• 230/33 6.2 300/5 60
• Estimated cost based on four types of microbes
  Campylobactor, Salmonella, E.-coli, Listeria
  http//www.ers.usda.gov
• Todd, Ag.Outlook Forum, 2003

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Healthcare costs by BMI
American Journal of Managed Care. Vol 43
141-145. 1998
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Policy and Research Challenges
What to do? INFORMATION standards and
truth Standards of commerce serving
sizes FAFH make information easy to use
Discount excuses not to label Target the
kids -- at school! What about the imitation
effect? Parents? Acknowledge behavioral
anomolies to economic rationality
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Indulgence / Abundance
Globally Globesity Adults 7
obese Children 53 undernourished But in
Chile, Australia, Malaysia, Chinese cities, 17
20 obese.
IFIC 3/29/2001
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Global Prevalence of Underweight and Obesity in
Adults for Year 2000, by Level of Development
Source Nutrition for Health and Development, A
Global Agenda for Combating Malnutrition, WHO
2000. www.who.int/nut/db_bmi.htm.
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Policy and Research Challenges
What to do? Parse out who can do
what. Economists identify full costs and
benefits --externalities --economic
solutions Industry responsibility Regulation
consistent with the behavior and the problem