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The Role Of Uncertainty On U.S. Obesity: An Application Of Control Theory

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Author Info
Pedro Gomis-Porqueras ()
Fidel Gonzalez

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Abstract

This paper considers the problem of a consumer that cares about her health, which we proxy by deviations from current weight to ideal weight, and derives utility from eating and disutility from performing physical activity while taking into account the uncertainty associated with calorie consumption and physical activity. Using U.S. data, we find that uncertainty regarding the effectiveness of physical activity produces a larger cautionary response. Moreover, it is harder to learn and is more important to the agent than the uncertainty regarding the calorie content of food. These results can help policymakers design more cost effective policies.

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File URL: http://www.ecocomm.anu.edu.au/research/papers/pdf/wp506.pdf
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Paper provided by Australian National University, College of Business and Economics, School of Economics in its series ANUCBE School of Economics Working Papers with number 2009-506.

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Length: 29 Pages
Date of creation: Sep 2009
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Handle: RePEc:acb:cbeeco:2009-506

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C61 - Mathematical and Quantitative Methods - - Mathematical Methods and Programming - - - Optimization Techniques; Programming Models; Dynamic Analysis
I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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  1. Jayachandran N. Variyam & John Cawley, 2006. "Nutrition Labels and Obesity," NBER Working Papers 11956, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  2. Darius Lakdawalla & Tomas Philipson & Jay Bhattacharya, 2005. "Welfare-Enhancing Technological Change and the Growth of Obesity," American Economic Review, American Economic Association, vol. 95(2), pages 253-257, May. [Downloadable!]
  3. Burke & Heiland, 2007. "Social Dynamics Of Obesity," Economic Inquiry, Western Economic Association International, vol. 45(3), pages 571-591, 07. [Downloadable!] (restricted)
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This page was last updated on 2009-11-12.

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