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The Role Of Uncertainty On U.S. Obesity: An Application Of Control Theory

  • Pedro Gomis-Porqueras

    ()

  • Fidel Gonzalez

This paper considers the problem of a consumer that cares about her health, which we proxy by deviations from current weight to ideal weight, and derives utility from eating and disutility from performing physical activity while taking into account the uncertainty associated with calorie consumption and physical activity. Using U.S. data, we find that uncertainty regarding the effectiveness of physical activity produces a larger cautionary response. Moreover, it is harder to learn and is more important to the agent than the uncertainty regarding the calorie content of food. These results can help policymakers design more cost effective policies.

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File URL: http://cbe.anu.edu.au/researchpapers/econ/wp506.pdf
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Paper provided by Australian National University, College of Business and Economics, School of Economics in its series ANU Working Papers in Economics and Econometrics with number 2009-506.

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Length: 29 Pages
Date of creation: Sep 2009
Date of revision:
Handle: RePEc:acb:cbeeco:2009-506
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  1. Mary Burke & Frank Heiland, 2006. "Social dynamics of obesity," Public Policy Discussion Paper 06-5, Federal Reserve Bank of Boston.
  2. 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.
  3. Jayachandran N. Variyam & John Cawley, 2006. "Nutrition Labels and Obesity," NBER Working Papers 11956, National Bureau of Economic Research, Inc.
  4. Pere Gomis-Porqueras & Adrian Peralta-Alva, 2008. "A macroeconomic analysis of obesity," Working Papers 2008-017, Federal Reserve Bank of St. Louis.
  5. Darius Lakdawalla & Tomas Philipson & Jay Bhattacharya, 2005. "Welfare-Enhancing Technological Change and the Growth of Obesity," American Economic Review, American Economic Association, vol. 95(2), pages 253-257, May.
  6. Pere Gomis-Porqueras & Adrian Peralta-Alva, 2005. "A Macroeconomic Analysis of Obesity in the U.S," Working Papers 0606, University of Miami, Department of Economics, revised 30 Aug 2007.
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