IDEAS home Printed from https://ideas.repec.org/a/bpj/bejeap/v10y2010i1n83.html
   My bibliography  Save this article

Economic Incentives for a Healthy Diet: A Comparison of Policies in a Canadian Context

Author

Listed:
  • Kennedy Peter W

    () (University of Victoria)

Abstract

This paper examines the potential impact of policies to promote dietary health in the context of a tax-financed universal health care (TFUHC) system, as found in Canada and many other countries, in which a universal level of treatment is set by government policy. I construct a model in which a low quality diet raises the risk of disease, and disease in turn causes a loss of labor productivity. Low quality diets are less expensive than high quality diets, so dietary choices are worse for lower income households. The effect of disease can be partly offset by medical treatment. I show that dietary choices under TFUHC are distorted by a moral hazard problem which leads to diets that are lower in quality than is first-best. I then examine three different policy interventions to address the dietary distortion: a reduced level of treatment; risk-based premiums for health care; and a quality-based tax on food. I calibrate the model with Canadian data on type 2 diabetes and derive the net benefit and distributional impact for each policy.

Suggested Citation

  • Kennedy Peter W, 2010. "Economic Incentives for a Healthy Diet: A Comparison of Policies in a Canadian Context," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(1), pages 1-32, September.
    • Handle: RePEc:bpj:bejeap:v:10:y:2010:i:1:n:83
    as

    Download full text from publisher

    File URL: https://www.degruyter.com/view/j/bejeap.2010.10.1/bejeap.2010.10.1.2475/bejeap.2010.10.1.2475.xml?format=INT
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. David M. Cutler & Edward L. Glaeser & Jesse M. Shapiro, 2003. "Why Have Americans Become More Obese?," Journal of Economic Perspectives, American Economic Association, vol. 17(3), pages 93-118, Summer.
    2. Yaniv, Gideon & Rosin, Odelia & Tobol, Yossef, 2009. "Junk-food, home cooking, physical activity and obesity: The effect of the fat tax and the thin subsidy," Journal of Public Economics, Elsevier, vol. 93(5-6), pages 823-830, June.
    3. Jayachandran N. Variyam & John Cawley, 2006. "Nutrition Labels and Obesity," NBER Working Papers 11956, National Bureau of Economic Research, Inc.
    4. Chou, Shin-Yi & Grossman, Michael & Saffer, Henry, 2004. "An economic analysis of adult obesity: results from the Behavioral Risk Factor Surveillance System," Journal of Health Economics, Elsevier, vol. 23(3), pages 565-587, May.
    5. Fred Kuchler & Abebayehu Tegene & J. Michael Harris, 2005. "Taxing Snack Foods: Manipulating Diet Quality or Financing Information Programs?," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 27(1), pages 4-20.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:bejeap:v:10:y:2010:i:1:n:83. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Golla). General contact details of provider: https://www.degruyter.com .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.