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Worth Your Weight: Experimental Evidence on the Benefits of Obesity in Low-Income Countries

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  • Elisa Macchi

Abstract

I study the economic value of obesity—a status symbol in poor countries associated with raised health risks. Randomizing decision-makers in Kampala, Uganda to view weight-manipulated portraits, I find that obesity is perceived as a reliable signal of wealth but not of beauty or health. Thus, leveraging a real-stakes experiment involving professional loan officers, I show that being obese facilitates access to credit. The large obesity premium, comparable to raising borrower self-reported earnings by over 60 percent, is driven by asymmetric information and drops significantly when providing more financial information. Notably, obesity benefits and wealth-signaling value are commonly overestimated, suggesting market distortions.

Suggested Citation

  • Elisa Macchi, 2023. "Worth Your Weight: Experimental Evidence on the Benefits of Obesity in Low-Income Countries," American Economic Review, American Economic Association, vol. 113(9), pages 2287-2322, September.
    • Handle: RePEc:aea:aecrev:v:113:y:2023:i:9:p:2287-2322
    DOI: 10.1257/aer.20211879
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    Citations

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    Cited by:

    1. Moisson, Paul-Henri, 2024. "Meritocracy and Inequality," TSE Working Papers 24-1518, Toulouse School of Economics (TSE), revised Apr 2024.
    2. Vojtech Bartos & Silvia Castro & Kristina Czura & Timm Opitz, 2023. "Gendered Access to Finance: The Role of Team Formation, Idea Quality, and Implementation Constraints in Business Evaluations," Rationality and Competition Discussion Paper Series 473, CRC TRR 190 Rationality and Competition.

    More about this item

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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