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Fast food prices, obesity, and the minimum wage

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  • Cotti, Chad
  • Tefft, Nathan

Abstract

Recent proposals argue that a fast food tax may be an effective policy lever for reducing population weight. Although there is growing evidence for a negative association between fast food prices and weight among adolescents, less is known about adults. That any measured relationship to date is causal is unclear because there has been no attempt to separate variation in prices on the demand side from that on the supply side. We argue that the minimum wage is an exogenous source of variation in fast food prices, conditional on income and employment. In two-stage least-squares analyses, we find little evidence that fast food price changes affect adult BMI or obesity prevalence. Results are robust to including controls for area and time fixed effects, area time trends, demographic characteristics, substitute prices, numbers of establishments and employment in related industries, and other potentially related factors.

Suggested Citation

  • Cotti, Chad & Tefft, Nathan, 2013. "Fast food prices, obesity, and the minimum wage," Economics & Human Biology, Elsevier, vol. 11(2), pages 134-147.
  • Handle: RePEc:eee:ehbiol:v:11:y:2013:i:2:p:134-147
    DOI: 10.1016/j.ehb.2012.04.002
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    References listed on IDEAS

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    Cited by:

    1. Bamikole, Oluwafemi, 2013. "The Impact of Minimum Wage on Average Earnings in the Caribbean using Two-Selected Countries, Trinidad and Tobago and Jamaica (1980-2011 and 1997-2011)," MPRA Paper 57363, University Library of Munich, Germany.
    2. Cawley, John, 2015. "An economy of scales: A selective review of obesity's economic causes, consequences, and solutions," Journal of Health Economics, Elsevier, vol. 43(C), pages 244-268.
    3. Brady P. Horn & Johanna Catherine Maclean & Michael R. Strain, 2017. "Do Minimum Wage Increases Influence Worker Health?," Economic Inquiry, Western Economic Association International, vol. 55(4), pages 1986-2007, October.
    4. Alviola, Pedro A. & Nayga, Rodolfo M. & Thomsen, Michael R. & Danforth, Diana & Smartt, James, 2014. "The effect of fast-food restaurants on childhood obesity: A school level analysis," Economics & Human Biology, Elsevier, vol. 12(C), pages 110-119.

    More about this item

    Keywords

    Fast food prices; Obesity; Body mass index; Minimum wage;

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General

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