Determining the impact of food price and income changes on body weight

Christiane Schroeter, Purdue University


During recent decades the number of obese adult Americans increased from 15% to 31%. The objective of this dissertation is to investigate the effects of food price and income changes on body weight in an effort to determine how a high-calorie food tax, a low-calorie food subsidy, and/or income changes could influence obesity. The Law of Demand states that raising the price of high-calorie food will lead to decreased consumption of that good. It is not clear that such an outcome will actually reduce weight. The theoretical model developed in this paper identifies conditions under which price and income changes are most likely to result in a weight loss. To carry out a complete investigation of the issue, the model is parameterized in two ways and the results are compared across methods. In the first method, the model parameters are drawn from previous economic and nutrition studies, and energy accounting is used. Data on own-price elasticities and cross-price elasticities are often readily available from the literature. This is important because survey data that contain both economic data and information on exercise intensity and body weights are extremely rare. The parametric implementation shows that a tax on food away from home, a food intake category blamed for much of the rise in obesity, could actually lead to an increase in body weight. This finding emphasizes the need to employ economic modeling when developing public policy to reduce obesity. The second part of this dissertation reports the direct estimation of the price-weight impact using data from a large-scale survey that contains information about individuals' weight, demographic characteristics, and physical activity information. The data is augmented with state-level measures pertaining to the prices of food away from home, food at home, and overtime wage information. Given the limited alternatives considered, both analyses show that a subsidy on food at home proves to be the most efficient method to decrease body weights. Knowledge of the structural relationships between economic constraints, demographic characteristics, lifestyle, and body weight allows decision makers to evaluate policies and their potential for success in obesity prevention.




Tyner, Purdue University.

Subject Area

Agricultural economics|Nutrition|Public health

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