This essay discusses whether ‘Calorie posting will solve the obesity crisis’. In this essay calorie posting refers to calorie information in restaurants at the point of sale.
Section 2 defines obesity and discusses some of the economic causes and costs of it. Section 3 discusses calorie posting as a specific solution. Section 4 briefly discusses alternative solutions. It is important that these are considered for a comparison against calorie posting. Section 5 concludes the essay and reaches a verdict on the statement.
Due to data availability, an adult body mass index (BMI) of over 30 is the standard definition of obesity. BMI is calculated using by BMI=(Weight in Kilograms)/〖(Height in Meters)〗^2 and, due to its …show more content…
Church et al (2011) found that this is a significant cause of increasing obesity.
Regardless of the cause of the obesity crisis, it has high costs.
Obesity increases the risk of a range of co-morbidities, and in recent years increased medical need due to obesity has caused healthcare costs to increase.(Dixon:2010;HarvardSOPH:2017). Cawley and Meyerhoefer (2010) estimated that obesity accounted for a whopping $168.4 billion (16.5%) in US medical spending in 2005. Within this, morbidly obese individuals have even higher medical costs than those just over the threshold of obesity.(Bhattacharya,Hyde&Tu:2014)
Obesity may also impact the labour market. Bhattacharya and Bundorf (2009) found that obesity causes lower wages in employed obese individuals. This combines with findings by Kinge (2016) that obesity increases the probability of “not working due to disability”. In total the lost productivity from obesity could be up to $73.1 billion annually in the US, as calculated by Finkelstein et al. (2017), with more obese individuals costing more than individuals at the …show more content…
The foremost market failure caused by obesity may be negative externalities and related moral hazard.
In countries with universal public health insurance, or coverage, obese individuals directly increase taxation for non-obese individuals. In countries with a non-mandatory health insurance system much of the costs are paid by non-obese individuals via higher premiums. In both of these cases healthcare costs are partly borne by society as opposed to the individual. By reducing obesity prevalence healthcare costs may decrease.
Negative externalities may also have been caused by the decrease in wages and productivity resulting in reduced productivity and increased unemployment benefits. McCormick and Stone (2007) estimated the increase in unemployment benefits to be between £1-£6 billion in the UK in 2007.
Imperfect information may cause market failure. For example consumers may lack information about nutritional content of their food and drink, possibly overconsuming calories as a result, as is the subject of this