Once considered as a serious public health issue only in developed countries, now
overweight and obesity have dramatically increased in low- and middle-income countries,
especially in urban settings (WHO, 2008). The main purpose of this study is to explore
the economic incentives for this rapid growth in obesity rates, by studying variations in
obesity over time and across geographic regions in the United States.
Although a number of researchers and policymakers have devoted significant
resources to address the recent rapid rise in obesity in the United States, “the prevalence
of overweight and obesity has increased sharply since the mid 1970s” (Centers for
Disease Control, 2008) and most of this increase occurred in the 1980s and 1990s (Cutler,
et al., 2003). More importantly, changes in food prices have also occurred over the past
30 years and have occurred simultaneously with the obesity epidemic (Finkelstein, et al.,
2005).
In this study, we investigate how the decline in food prices in the last three decades
affects the long-run growth of obesity rates. We take the advantage of the large panel data
that cover for the time periods with the fastest growth of obesity rates, by using
metropolitan samples from the National Health Interview Survey (NHIS) and information
on prices of food at home and food away from home from these major metropolitan areas
for years 1976 to 2001. Specifically, instead of using absolute food prices, we explore the
impacts from changes in relative prices of food at home and food away from home (i.e.
food prices relative to prices for a market basket of consumer goods and services in these
metropolitan areas), as well as changes in prices of food at home and food away from
home on the growth in obesity rates during this time frame. We also control for the
changes in contextual factors and changes in value of female in these metropolitan areas.
Our findings reveal the important fact that changes in relative food prices can explain
about 20 percent of the obesity growth during this time period and such effect is more
pronounced for the low-educated. The results of the study provide an interpretation of the
long-run growth of obesity rates in urban settings