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The Economic Analysis Of Obesity


  • Tahereh Alavi Hojjat


Over the past several decades, obesity has grown into a major global epidemic. Obesity in the United States is widely acknowledged to be a severe and growing problem. In the United States (U.S.), more than two-thirds of adults are now overweight and one-third of the overweight population is obese. There is growing evidence that obesity in America is largely an economic issue. In this paper, we will provide an overview and an economic analysis of obesity based on behavioral economics as a non-rational behavior. Economic costs of obesity are discussed with an emphasis on healthcare costs, as obesity is perhaps the largest medical problem in America. Research to date has identified at least four major categories of economic impacts linked with the obesity epidemic: direct medical costs, productivity costs, transportation costs, and human capital costs. Stemming the obesity epidemic cannot be separated from stemming the tide of poverty and income inequality gap. The obesity issue could be related to rising fastfood outlets and availability of vending machines, too much advertising for unhealthy food, the falling value of minimum wage, government subsidies, income inequality gap, and lack of health and family benefits. These issues need to be addressed through a concerted program of environmental and policy interventions.

Suggested Citation

  • Tahereh Alavi Hojjat, 2015. "The Economic Analysis Of Obesity," Review of Business and Finance Studies, The Institute for Business and Finance Research, vol. 6(1), pages 81-98.
  • Handle: RePEc:ibf:rbfstu:v:6:y:2015:i:1:p:81-98

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    References listed on IDEAS

    1. Alois Stutzer & Armando N. Meier, 2016. "Limited Self‐control, Obesity, and the Loss of Happiness," Health Economics, John Wiley & Sons, Ltd., vol. 25(11), pages 1409-1424, November.
    2. Finkelstein, Eric A. & Strombotne, Kiersten L. & Popkin, Barry M., 2010. "The Costs of Obesity and Implications for Policymakers," Choices: The Magazine of Food, Farm, and Resource Issues, Agricultural and Applied Economics Association, vol. 25(3), pages 1-7.
    3. John F. Tomer, 2008. "Intangible Capital," Books, Edward Elgar Publishing, number 12605, December.
    4. Shin-Yi Chou & Inas Rashad & Michael Grossman, 2008. "Fast-Food Restaurant Advertising on Television and Its Influence on Childhood Obesity," Journal of Law and Economics, University of Chicago Press, vol. 51(4), pages 599-618, November.
    5. Blisard, Noel & Stewart, Hayden & Jolliffe, Dean, 2004. "Low-Income Households' Expenditures on Fruits and Vegetables," Agricultural Information Bulletins 33755, United States Department of Agriculture, Economic Research Service.
    6. John Tomer, 2011. "What Causes Obesity? And Why Has It Grown So Much?," Challenge, Taylor & Francis Journals, vol. 54(4), pages 22-49.
    7. 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.
    8. Leslie McGranahan & Diane Whitmore Schanzenbach, 2011. "Who would be affected by soda taxes?," Chicago Fed Letter, Federal Reserve Bank of Chicago, issue Mar.
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    More about this item


    Obesity; Medical Costs; Economics; Inequality Gap; Poverty; Food Prices; Diet Cost;

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • H00 - Public Economics - - General - - - General
    • I1 - Health, Education, and Welfare - - Health


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