IDEAS home Printed from https://ideas.repec.org/a/ucp/jacres/doi10.1086-686244.html
   My bibliography  Save this article

The Obesity Crisis as Market Failure: An Analysis of Systemic Causes and Corrective Mechanisms

Author

Listed:
  • Aneel Karnani
  • Brent McFerran
  • Anirban Mukhopadhyay

Abstract

Obesity has high personal, social, and economic costs. Since medical research demonstrates that the primary cause of obesity is caloric intake, and food is bought and sold in the consumer marketplace, we begin with the argument that obesity represents a case of market failure. Integrating empirical research in consumer behavior with theories from public economics and business strategy, we examine the four possible corrective mechanisms to address market failures: government intervention, corporate social responsibility, industry self-regulation, and social activism. Taking the same lens, we examine how market-level conditions can be applied to correct market failures in the context of obesity, making a critical evaluation of various extant suggestions on how best to address the problem of obesity.

Suggested Citation

  • Aneel Karnani & Brent McFerran & Anirban Mukhopadhyay, 2016. "The Obesity Crisis as Market Failure: An Analysis of Systemic Causes and Corrective Mechanisms," Journal of the Association for Consumer Research, University of Chicago Press, vol. 1(3), pages 445-470.
    • Handle: RePEc:ucp:jacres:doi:10.1086/686244
    DOI: 10.1086/686244
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1086/686244
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: http://dx.doi.org/10.1086/686244
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: https://libkey.io/10.1086/686244?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    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. repec:arz:wpaper:eres2011-88 is not listed on IDEAS
    2. Lerner, Abba P, 1972. "The Economics and Politics of Consumer Sovereignty," American Economic Review, American Economic Association, vol. 62(2), pages 258-266, May.
    3. Raj Chetty & Adam Looney & Kory Kroft, 2009. "Salience and Taxation: Theory and Evidence," American Economic Review, American Economic Association, vol. 99(4), pages 1145-1177, September.
    4. Neil Wrigley, 2002. "'Food Deserts' in British Cities: Policy Context and Research Priorities," Urban Studies, Urban Studies Journal Limited, vol. 39(11), pages 2029-2040, October.
    5. Andreyeva, T. & Long, M.W. & Brownell, K.D., 2010. "The impact of food prices on consumption: A systematic review of research on the price elasticity of demand for food," American Journal of Public Health, American Public Health Association, vol. 100(2), pages 216-222.
    6. A, Savvas & C, Boulton & E, Jepsen, 2011. "Influences on Indigenous Labour Market Outcomes," Staff Working Papers 114, Productivity Commission, Government of Australia.
    7. Ansink, Erik & Houba, Harold, 2012. "Market power in water markets," Journal of Environmental Economics and Management, Elsevier, vol. 64(2), pages 237-252.
    8. Alexander Chernev, 2011. "Semantic Anchoring in Sequential Evaluations of Vices and Virtues," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 37(5), pages 761-774.
    9. Juliano Laran, 2010. "Goal Management in Sequential Choices: Consumer Choices for Others Are More Indulgent than Personal Choices," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 37(2), pages 304-314, August.
    10. Amy Finkelstein, 2009. "E-ztax: Tax Salience and Tax Rates," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(3), pages 969-1010.
    11. Jenny G. Olson & Brent McFerran & Andrea C. Morales & Darren W. Dahl, 2016. "Wealth and Welfare: Divergent Moral Reactions to Ethical Consumer Choices," Journal of Consumer Research, Oxford University Press, vol. 42(6), pages 879-896.
    12. Young, L.R. & Nestle, M., 2002. "The contribution of expanding portion sizes to the US obesity epidemic," American Journal of Public Health, American Public Health Association, vol. 92(2), pages 246-249.
    13. Tomas Philipson & Richard Posner, 2008. "Is the Obesity Epidemic a Public Health Problem? A Decade of Research on the Economics of Obesity," NBER Working Papers 14010, National Bureau of Economic Research, Inc.
    14. Andreyeva, Tatiana & Kelly, Inas Rashad & Harris, Jennifer L., 2011. "Exposure to food advertising on television: Associations with children's fast food and soft drink consumption and obesity," Economics & Human Biology, Elsevier, vol. 9(3), pages 221-233, July.
    15. Raj Chetty, 2009. "The Simple Economics of Salience and Taxation," NBER Working Papers 15246, National Bureau of Economic Research, Inc.
    16. Puhl, R.M. & Heuer, C.A., 2010. "Obesity stigma: Important considerations for public health," American Journal of Public Health, American Public Health Association, vol. 100(6), pages 1019-1028.
    17. Richards, Timothy J. & Padilla, Luis, 2007. "Promotion and Fast Food Demand: Where's the Beef?," Consumer and Market Demand Network Papers 7711, University of Alberta, Department of Resource Economics and Environmental Sociology.
    18. anonymous, 2011. "The future of financial market regulation," Forefront, Federal Reserve Bank of Cleveland, issue Winter, pages 1-2.
    19. Lyons Russell, 2011. "The Spread of Evidence-Poor Medicine via Flawed Social-Network Analysis," Statistics, Politics and Policy, De Gruyter, vol. 2(1), pages 1-29, May.
    20. Cawley, John & Meyerhoefer, Chad, 2012. "The medical care costs of obesity: An instrumental variables approach," Journal of Health Economics, Elsevier, vol. 31(1), pages 219-230.
    21. Long, M.W. & Tobias, D.K. & Cradock, A.L. & Batchelder, H. & Gortmaker, S.L., 2015. "Systematic review and meta-analysis of the impact of restaurant menu calorie labeling," American Journal of Public Health, American Public Health Association, vol. 105(5), pages 11-24.
    22. Andrew S. Hanks & David R. Just & Brian Wansink, 2012. "Healthy Convenience: Nudging Students Toward Healthier Choices in Lunchroom," Working Papers 03, Cornell Center for Behavioral Economics in Child Nutrition Programs.
    23. Bruce C. Greenwald & Joseph E. Stiglitz, 1986. "Externalities in Economies with Imperfect Information and Incomplete Markets," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 101(2), pages 229-264.
    24. George A. Akerlof, 1970. "The Market for "Lemons": Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 84(3), pages 488-500.
    25. Andrew S. Hanks & David R. Just & Brian Wansink, "undated". "Healthy Convenience: Nudging Students Toward Healthier Choices in Lunchroom," Working Papers 2012-03, Cornell Center for Behavioral Economics in Child Nutrition Programs.
    26. Aneel Karnani, 2007. "Doing well by doing good—case study: ‘Fair & Lovely’ whitening cream," Strategic Management Journal, Wiley Blackwell, vol. 28(13), pages 1351-1357, December.
    27. Landman, A. & Ling, P.M. & Glantz, S.A., 2002. "Tobacco industry youth smoking prevention programs: Protecting the industry and hurting tobacco control," American Journal of Public Health, American Public Health Association, vol. 92(6), pages 917-930.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Panzone, Luca A., 2022. "Conditional Promotion With A Costly Reward: An Evaluation Of A Campaign To Motivate Consumption Of Fruit And Vegetables," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322058, Agricultural and Applied Economics Association.
    2. Dominic Thomas, 2022. "Unhealthy food preferences: A psychological consequence of poverty?," Journal of Consumer Affairs, Wiley Blackwell, vol. 56(2), pages 613-639, June.
    3. Mockshell, Jonathan & Asante-Addo, Collins & Andam, Kwaw S. & Asante, Felix A., 2021. "Transitioning to nutrition-sensitive food environments: Triple sector strategies to reduce the triple burden of malnutrition," 2021 Conference, August 17-31, 2021, Virtual 315410, International Association of Agricultural Economists.
    4. Jihye Park & H. Rao Unnava, 2024. "A double-edged sword: the effect of brand self-regulatory messages on brand attitude in the U.S," Journal of Brand Management, Palgrave Macmillan, vol. 31(5), pages 482-501, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Fabrice Etilé, 2019. "The Economics of Diet and Obesity: Public Policy," PSE-Ecole d'économie de Paris (Postprint) hal-02154445, HAL.
    2. Rudi, Jeta & Çakır, Metin, 2017. "Vice or virtue: How shopping frequency affects healthfulness of food choices," Food Policy, Elsevier, vol. 69(C), pages 207-217.
    3. Haisken-DeNew, John & Hasan, Syed & Jha, Nikhil & Sinning, Mathias, 2018. "Unawareness and selective disclosure: The effect of school quality information on property prices," Journal of Economic Behavior & Organization, Elsevier, vol. 145(C), pages 449-464.
    4. Peggy J. Liu & Kelly L. Haws & Karen Scherr & Joseph P. Redden & James R. Bettman & Gavan J. Fitzsimons, 2019. "The Primacy of “What” over “How Much”: How Type and Quantity Shape Healthiness Perceptions of Food Portions," Management Science, INFORMS, vol. 65(7), pages 3353-3381, July.
    5. Alejandro Ponce & Enrique Seira & Guillermo Zamarripa, 2017. "Borrowing on the Wrong Credit Card? Evidence from Mexico," American Economic Review, American Economic Association, vol. 107(4), pages 1335-1361, April.
    6. John Cawley & Alex Susskind & Barton Willage, 2020. "The Impact of Information Disclosure on Consumer Behavior: Evidence from a Randomized Field Experiment of Calorie Labels on Restaurant Menus," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 39(4), pages 1020-1042, September.
    7. Goldin, Jacob, 2015. "Optimal tax salience," Journal of Public Economics, Elsevier, vol. 131(C), pages 115-123.
    8. Burman, Leonard E. & Coe, Norma B. & Dworsky, Michael & Gale, William G., 2012. "Effects of Public Policies on the Disposition of Pre-Retirement Lump-Sum Distributions: Rational and Behavioral Influences," National Tax Journal, National Tax Association;National Tax Journal, vol. 65(4), pages 863-887, December.
    9. Scott R. Baker & Stephanie Johnson & Lorenz Kueng, 2021. "Shopping for Lower Sales Tax Rates," American Economic Journal: Macroeconomics, American Economic Association, vol. 13(3), pages 209-250, July.
    10. Palmer, Karen & Walls, Margaret, 2015. "Does Information Provision Shrink the Energy Efficiency Gap? A Cross-City Comparison of Commercial Building Benchmarking and Disclosure Laws," RFF Working Paper Series dp-15-12, Resources for the Future.
    11. Dmitry Taubinsky & Alex Rees-Jones, 2018. "Attention Variation and Welfare: Theory and Evidence from a Tax Salience Experiment," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 85(4), pages 2462-2496.
    12. Beshears, John & Choi, James J. & Laibson, David & Madrian, Brigitte C., 2017. "Does front-loading taxation increase savings? Evidence from Roth 401(k) introductions," Journal of Public Economics, Elsevier, vol. 151(C), pages 84-95.
    13. Johannes Abeler & Simon Jäger, 2013. "Complex Tax Incentives - An Experimental Investigation," CESifo Working Paper Series 4231, CESifo.
    14. Sebastien Bradley & Naomi E. Feldman, 2020. "Hidden Baggage: Behavioral Responses to Changes in Airline Ticket Tax Disclosure," American Economic Journal: Economic Policy, American Economic Association, vol. 12(4), pages 58-87, November.
    15. Etro, Federico, 2016. "Research in economics and public finance," Research in Economics, Elsevier, vol. 70(1), pages 1-6.
    16. James Alm & Carolyn J. Bourdeaux, 2013. "Applying Behavioral Economics to the Public Sector," Hacienda Pública Española / Review of Public Economics, IEF, vol. 206(3), pages 91-134, September.
    17. Mazhar Waseem, 2020. "Does Cutting the Tax Rate to Zero Induce Behavior Different from Other Tax Cuts? Evidence from Pakistan," The Review of Economics and Statistics, MIT Press, vol. 102(3), pages 426-441, July.
    18. Arun Advani & Hannah Tarrant, 2021. "Behavioural responses to a wealth tax," Fiscal Studies, John Wiley & Sons, vol. 42(3-4), pages 509-537, September.
    19. Altemeyer-Bartscher, Martin, 2014. "Fiscal Equalization, Tax Salience, and Tax Competition," VfS Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100622, Verein für Socialpolitik / German Economic Association.
    20. Iñigo Iturbe-Ormaetxe, 2015. "Salience of social security contributions and employment," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 22(5), pages 741-759, October.

    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:ucp:jacres:doi:10.1086/686244. See general information about how to correct material in RePEc.

    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 bibliographic 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Journals Division (email available below). General contact details of provider: https://www.journals.uchicago.edu/JACR .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.