Abstract: We study the relationship between urban sprawl and obesity. Using data that tracks individuals over time, we find no evidence that urban sprawl causes obesity. We show that previous findings of a positive relationship most likely reflect a failure to properly control for the fact the individuals who are more likely to be obese choose to live in more sprawling neighborhoods. Our results indicate that current interest in changing the built environment to counter the rise in obesity is misguided. Key words: urban sprawl, obesity, selection effects jel classification: i12, r14

Ravallion, Rodrigo Soares, and Jim Smith for comments and help in the preparation of this Disease has traveled with goods and people since the earliest times. Armed globalization spread disease, to the extent of eliminating entire populations. The geography of disease shaped patterns of colonization and industrialization throughout the now poor world. Many see related threats to public health from current globalization. Multilateral and bilateral trade agreements do not always adequately represent the interests of poor countries, the General Agreement on Trade in Services may restrict the freedom of signatories to shape their own health delivery systems, and it remains unclear whether current arrangements for intellectual property rights are in the interests of citizens of poor countries with HIV/AIDS. However, to the extent that globalization promotes economic growth, population health may benefit, and there has been substantial reductions in poverty and in international inequalities in life-expectancy over the last 50 years. Although there is a strong inverse relationship between the poverty and life-expectancy in levels, gains in life expectancy have been only weakly correlated with growth rates and, in the last decade, the HIV/AIDS epidemic has widened international inequalities in life expectancy. The rapid

Regulating specific inputs into health and safety production functions is unlikely to be effective when optimizing consumers can compensate along other margins. This paper examines the implications of this principle in the context of economic policies targeted at reducing obesity. Well-established cross-sectional and time-series correlations between average body weight and eating out have convinced many researchers and policymakers that restaurants are a leading cause of obesity in the United States. But a basic identification problem challenges these conclusions: do more restaurants cause obesity, or do preferences for greater food consumption lead to an increase in restaurant density? To answer this question, we design a natural experiment in which we exploit exogenous variation in the effective price of restaurants and examine the impact on consumers ’ body mass. We use the presence of Interstate Highways in rural areas as an instrument for the supply of restaurants. The instrument strongly predicts restaurant access and frequency of consumption, and robustness tests support its validity. The results find no evidence of a causal link between restaurants and obesity, and the estimates are precise enough to rule out any meaningful effect. Analysis of food intake micro data suggests that although consumers eat larger meals at restaurants than at home (even after accounting for selection), they offset these calories at other times of day. We conclude that public health policies targeting restaurants are unlikely to reduce obesity but could negatively affect consumer welfare.

Abstract. We investigate the health consequences of changes in the supply of fast food using the exact geographical location of fast food restaurants. Specifically, we ask how the supply of fast food affects the obesity rates of 3 million school children and the weight gain of over 1 million pregnant women. We find that among 9 th grade children, a fast food restaurant within a tenth of a mile of a school is associated with at least a 5.2 percent increase in obesity rates. There is no discernable effect at.25 miles and at.5 miles. Among pregnant women, models with mother fixed effects indicate that a fast food restaurant within a half mile of her residence results in a 2.5 percent increase in the probability of gaining over 20 kilos. The effect is larger, but less precisely estimated at.1 miles. In contrast, the presence of non-fast food restaurants is uncorrelated with obesity and weight gain. Moreover, proximity to future fast food restaurants is uncorrelated with current obesity and weight gain, conditional on current proximity to fast food. The implied effects of fast-food on caloric intake are at least one order of magnitude smaller for mothers, which suggests that they are less constrained by travel costs than school children. Our results imply that policies restricting access to fast food near schools could

I show that after accounting for predictable variation arising from movements in real interest rates, preferences, income shocks, liquidity constraints and measurement errors, volatility of household consumption in the US increased between 1970 and 2004. For households headed by nonwhite and/or poorly educated individuals, this rise was significantly larger. This stands in sharp contrast with the dramatic fall in instability of the aggregate U.S. economy over the same period. Thus, while aggregate shocks affecting households fell over time, idiosyncratic shocks increased. This finding may lead to significant welfare implications.

Ozyegin University. The first and second authors contributed equally to this paper. Unintended Nutrition Consequences: Firm Responses to the Nutrition Labeling and Education Act This paper investigates how firms responded to standardized nutrition labels on food products required by the Nutrition Labeling and Education Act (NLEA). Using a longitudinal quasi-experimental design, we test our predictions using two large-scale samples that span thirty product categories. Results indicate that the NLEA reduced brand nutritional quality relative to a control group of products not regulated by the NLEA. At the same time, among those regulated products, brand taste increased. While this reduction in nutrition represents an unintended consequence of regulation, there were a set of category, firm, and brand conditions under which the NLEA produced a positive effect on brand nutritional quality. We find that firms were more likely to improve brand nutrition when firm risk or firm power is low. Greater risk occurs when the firm is introducing a new brand rather than changing an existing brand and weaker power in a category is reflected by total market share in a category. Further, firms competing in low-health categories (e.g., potato chips) or small-portion categories (e.g., peanut butter) improved nutrition

Abstract: This paper computes the welfare benefits of additional information about nutritional content in food by revealed preference and evaluates quantitatively whether the estimated behavioral response is consistent with information from experts on the relationship between diet and health. In doing so, it provides estimates of the impact of the law mandating nutrition labeling for all prepackaged foods in the US on nutrient consumption. Estimates derived from a structural model identified based on differential changes in information across foods are consistent with reduced form estimates comparing the change in calorie consumption among label users and non-label users. Taking the estimated willingness to pay for nutrient content as given implies that the labeling law led to an increase in consumer surplus of 25−40 annually for each label user and that additional labeling regulations could generate a comparable benefit. Comparing the implicit value of nutrient information with a benchmark computed from medical evidence and the value of a statistical life (VSL) suggests that consumers are insufficiently responsive to health differences across foods. Taking this benchmark as the normative standard, revealed preference estimates understate the benefits of labeling by a factor of four, and thousands of dollars in additional per capita welfare gains could be realized by policies which would lead consumers to eat healthier foods.

Why is America a land of low-calorie food claims yet high-calorie food intake? Four studies show that people are more likely to underestimate the caloric content of main dishes and to choose higher-calorie side dishes, drinks, or desserts when fast-food restaurants claim to be healthy (e.g., Subway) compared to when they do not (e.g., McDonald’s). We also find that the effect of these health halos can be eliminated by simply asking people to consider whether the opposite of such health claims may be true. These studies help explain why the success of fastfood restaurants serving lower-calorie foods has not led to the expected reduction in total calorie intake and in obesity rates. They also suggest innovative strategies for consumers, marketers, and policy makers searching for ways to fight obesity. As the popularity of healthier menus increases, so does the weight of many Americans. Between 1991 and 2001, the proportion of obese U.S. adults has grown from 23 % to 31 % of the population, a 3 % annual compound rate (National Center for Health Statistics 2002). In the same period, the proportion of U.S. adults consuming low-calorie food and beverages grew from 48 % to 60 % of the population (a 2.3 % annual compound rate), and the proportion of U.S. consumers trying to eat a healthy diet grew at a 6 % annual

This paper presents a behavioral economics model with bounded rationality to describe an individual’s food consumption choices that lead to weight gain and dieting. Using a physiological relationship determining calories needed to maintain weight, we simulate the food consumption choices of a representative female over a 30 year period. Results show that a diet will reduce weight only temporarily. Recurrence of weight gain leads to cyclical dieting, which reduces the trend rate of weight increase. Dieting frequency is shown to depend on decision period length, dieting costs, and habit persistence. JEL Codes: Keywords:

The Centre for Market and Public Organisation, a Research Centre based at the University of Bristol, was established in 1998. The principal aim of the CMPO is to develop understanding of the design of activities within the public sector, on the boundary of the state and within recently privatised entities with the objective of developing research in, and assessing and informing policy toward, these activities. Centre for Market and Public Organisation