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Effects of U.S. Public Agricultural R&D on U.S. Obesity and its Social Costs

  • Alston, Julian M.
  • Okrent, Abigail M.
  • Parks, Joanna

How much has food abundance, attributable to U.S. public agricultural R&D, contributed to the high and rising U.S. obesity rates? In this paper we investigate the effects of public investment in agricultural R&D on food prices, per capita calorie consumption, adult body weight, obesity, public health-care expenditures related to obesity, and social welfare. First we use an econometric model to estimate the average effect of an incremental investment in agricultural R&D on the farm prices of ten categories of farm commodities. Next, we use the econometric results in a simulation model to estimate the implied changes in prices and quantities consumed of nine categories of food for given changes in research expenditures. Finally, we estimate the corresponding changes in social welfare, including both the traditional measures of changes in economic surplus in markets for food and farm commodities, and changes in public health-care expenditures associated with the predicted changes in food consumption and hence obesity. We find that a 10 percent increase in the stream of annual U.S. public investment in agricultural R&D in the latter half of the 20th century would have caused a modest increase in average daily calorie consumption of American adults, resulting in small increases in social costs of obesity. On the other hand, such an increase in spending would have generated very substantial net national benefits given the very large benefit-cost ratios for agricultural R&D.

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Paper provided by Australian Agricultural and Resource Economics Society in its series 2013 Conference (57th), February 5-8, 2013, Sydney, Australia with number 152174.

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Date of creation: Feb 2013
Date of revision:
Handle: RePEc:ags:aare13:152174
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  1. James Miller & Keith Coble, 2005. "Cheap Food Policy: Fact or Rhetoric," Others 0506008, EconWPA.
  2. David M. Cutler & Edward L. Glaeser & Jesse M. Shapiro, 2003. "Why Have Americans Become More Obese?," Harvard Institute of Economic Research Working Papers 1994, Harvard - Institute of Economic Research.
  3. 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.
  4. Alston, Julian M. & Sumner, Daniel A. & Vosti, Stephen A., 2008. "Farm subsidies and obesity in the United States: National evidence and international comparisons," Food Policy, Elsevier, vol. 33(6), pages 470-479, December.
  5. Alston, Julian M. & Andersen, Matthew A. & James, Jennifer S. & Pardey, Philip G., 2011. "The Economic Returns to U.S. Public Agricultural Research," Staff Papers 95522, University of Minnesota, Department of Applied Economics.
  6. Okrent, Abigail M. & Alston, Julian M., 2011. "The Effects of Farm Commodity and Retail Food Policies on Obesity and Economic Welfare in the United States," Working Papers 162516, Robert Mondavi Institute Center for Wine Economics.
  7. Miller, J. Corey & Coble, Keith H., 2008. "An International Comparison of the Effects of Government Agricultural Support on Food Budget Shares," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 40(02), August.
  8. Rickard, Bradley J. & Okrent, Abigail M. & Alston, Julian M., 2011. "How have agricultural policies influenced caloric consumption in the United States?," Working Papers 126543, Cornell University, Department of Applied Economics and Management.
  9. Alston, Julian M. & Sumner, Daniel A. & Vosti, Stephen A., 2006. "Are Agricultural Policies Making Us Fat? Likely Links Between Agricultural Policies and Human Nutrition and Obesity, and their Policy Implications," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25343, International Association of Agricultural Economists.
  10. Shin-Yi Chou & Michael Grossman & Henry Saffer, 2002. "An Economic Analysis of Adult Obesity: Results from the Behavioral Risk Factor Surveillance System," NBER Working Papers 9247, National Bureau of Economic Research, Inc.
  11. Parks, Joanna C. & Alston, Julian M. & Okrent, Abigail M., 2012. "The Marginal External Cost of Obesity in the United States," Working Papers 162519, Robert Mondavi Institute Center for Wine Economics.
  12. Chouinard Hayley H & Davis David E & LaFrance Jeffrey T & Perloff Jeffrey M, 2007. "Fat Taxes: Big Money for Small Change," Forum for Health Economics & Policy, De Gruyter, vol. 10(2), pages 1-30, June.
  13. Darius Lakdawalla & Tomas Philipson, 2002. "The Growth of Obesity and Technological Change: A Theoretical and Empirical Examination," Working Papers 0203, Harris School of Public Policy Studies, University of Chicago.
  14. Cash, Sean B. & Sunding, David L. & Zilberman, David, 2004. "Fat Taxes And Thin Subsidies: Prices, Diet, And Health Outcomes," 2004 Annual meeting, August 1-4, Denver, CO 19961, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  15. repec:ags:aaea10:61674 is not listed on IDEAS
  16. John Cawley & Chad Meyerhoefer, 2010. "The Medical Care Costs of Obesity: An Instrumental Variables Approach," NBER Working Papers 16467, National Bureau of Economic Research, Inc.
  17. repec:ags:aaea10:61675 is not listed on IDEAS
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