Cheap donuts and expensive broccoli

One reason for obesity may be that unhealthy foods are cheaper than healthier foods. So can we make people thinner by taxing unhealthy foods? See Gelbach, Klick and Stratmann, Cheap Donuts and Expensive Broccoli: the Effect of Relative Prices on Obesity. Here's the abstract:

Americans have been getting fatter since at least the mid 1980s. To better understand this public health problem, much attention has been devoted to determining the underlying cause of increasing body weights in the U.S. We examine the role of relative food prices in determining an individual's body mass index, arguing that as healthful foods become more expensive relative to unhealthful foods, individuals substitute to a less healthful diet. Using data from the National Health Interview Survey (NHIS) for the period 1982-1996, we find that individual BMI measures, as well as the likelihood of being overweight or obese, exhibit a statistically significant positive correlation with the prices of healthful relative to unhealthful foods. These results are robust to endogenizing the relative price measure. While the magnitudes of our estimates suggest that relative price changes can only explain about 1 percent of the growth in BMI and the incidence of being overweight or obese over this period, they do provide some measure of how effective fat taxes would be in controlling the obesity epidemic. Our estimates imply, for example, that a 100 percent tax on unhealthful foods could reduce average BMI by about 1 percent, and the same tax could reduce the incidence of being overweight and the incidence of obesity by 2 percent and 1 percent respectively.

Comments

[arthur]

Stimulating and thought provoking! Thank you Larry. Bravo!