PMID: 16532659Mar 15, 2006Paper

Markets and childhood obesity policy

The Future of Children
John Cawley

Abstract

In examining the childhood obesity epidemic from the perspective of economics, John Cawley looks at both possible causes and possible policy solutions that work through markets. The operation of markets, says Cawley, has contributed to the recent increase in childhood overweight in three main ways. First, the real price of food fell. In particular, energy-dense foods, such as those containing fats and sugars, became relatively cheaper than less energy-dense foods, such as fresh fruits and vegetables. Second, rising wages increased the "opportunity costs" of food preparation for college graduates, encouraging them to spend less time preparing meals. Third, technological changes created incentives to use prepackaged food rather than to prepare foods. Several economic rationales justify government intervention in markets to address these problems. First, because free markets generally under-provide information, the government may intervene to provide consumers with nutrition information they need. Second, because society bears the soaring costs of obesity, the government may intervene to lower the costs to taxpayers. Third, because children are not what economists call "rational consumers"--they cannot evaluate information critica...Continue Reading

Citations

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