#20 Obesity economics

Hi all,

As my regular readers know by now, I like to do sports. Currently, my objective (or, as my housemates would call it, obsession) is swimming long(er) distances. This means that I try to train three times a week and also do some exercise. When I sport regularly, I feel healthier and better in shape. And sharper at work. Although my objective (some swims in August) is, as I know, completely unimportant, it helps me to have a target and discipline. It does not matter to anyone how fast I swim except for myself.

But with a job and family, it is a struggle to find the time. But it is also a luxury struggle: I have the means to eat healthy, sleep well, and have the mental space to occupy myself with individual (inherently useless) exercise.

As an economist, I conclude from experience that doing sports and living healthy are luxury goods.

And that seems accurate: higher-income groups tend to have better health, a ‘stylised fact’.

However, at least three things complicate the relationship between health and economic progress (see, for instance, this classic article in the Journal of Economic Literature by Angus Deaton or this one from Picket and Wilkinson). Between countries, it matters how rich countries are (as measured by GDP per capita), the quality of institutions, socio-economic inequality, and the quality of healthcare and access to it. Within countries, differences can be explained by income inequality (which determines a large part of lifestyle), access to

I don’t want to discuss all these facets here. I want to restrict myself to a simpler question. What is the relationship between obesity and economic progress in rich countries?

But first, I would like to give you some background on the relationship between economic growth and health in general. The recent, long-run evidence is pretty straightforward. In the long run, higher incomes correlate with a higher life expectancy on average between countries. However, these long-run life expectancy improvements depended on advancing medical knowledge as much as on economic growth that facilitated better nutrition and the provision of health services. Therefore, these health transitions (the effects of medical breakthroughs) also go in waves around the Globe, starting in the rich part and ending up improving life expectancies in poorer countries. So, there is no guarantee that ongoing economic growth will lead to better health.

And this relates to the obesity topic. The overall conclusion on the relationship between economic growth and obesity is clear: Economic growth and obesity correlate. According to this research, over the 40 years 1975–2014, adult obesity prevalence increased at a declining rate with GDPPC across the 147 countries.

Moreover, there is no indication that this trend reverses for higher-income countries (although for some groups, like me, people tend to have the luxury of being less overweight).

The conclusion is, however, necessary. In wealthier countries, people seem to be more overweight, which increases with increased GDP. For instance, in the Netherlands, the correlation between economic growth and obesity is .98, while the correlation between economic growth and (self-reported) happiness is…..-.06 (see also the figure below). In other words, we probably overeat (on average), leading to all kinds of things but not happiness (on average).

This is important. It is a sign of a society entirely out of balance.

As Tim Jackson argues in his book Post growth:

Calorie counting, believe it or not, works through one of the most fundamental laws of physics: the first law of thermodynamics. Carolies are a measure of energy.. Thermodynamics is the study of energy transformations. The calories we consume are transformed in physical processes within our body. but the energy is always conserved along the way. […] Whatever is left from the calories we consume will be stored in the body as fat (a form of chemical energy). This is where the first law comes in. If your calorie intake exceeds the basic maintenance energy needed to keep you alive plus the energy you exert through physical activity, the excess energy is stored in the body, usually as fat.

Source: Tim Jackson (2021), p 70.

The link with economic metabolism is so apparent. As long as there is a lack of calories (or the fulfilment of basic needs), growth is good for the financial system (as long as it fits within its natural environment). It derails when basic needs are fulfilled, and growth becomes a goal. To quote Tim Jackson again: More is only better when not enough (Jackson, 2021, p. 71). However, the economic system is not built in such a way. We are seduced to consume more fat, salt, and sweet food, which we like most. Ultra-processed food helps societies become more obese and helps the food industry earn money .

There is no easy way to stop this. An economic system wants to expand; that is its natural state. And for humans within that system, it is difficult to resist that. We all know from ourselves that balance, not growth, is the essence of personal and societal prosperity.

One option is to think more about the concept of frugal abundance . In a society where everyone has a good life, consumption is low enough to achieve global ecological and social justice, and everyone's material wants are satisfied, this is where obesity could decline. Also, from this research, it is clear that materially wealthy people do not tend to be more happy than (materially) poorer people.

As we all know from our personal lives, proper growth lies in finding balance. Living a healthy, fulfilling life requires us to be mindful of having enough rather than constantly seeking more. This means recognizing when we have eaten sufficient instead of overindulging and appreciating what we have instead of wanting it all. We strive for balance through adequate sleep, physical exercise, meaningful social relationships, and fulfilling work. This is the essence of a good life.

If we understand this as individuals, we can apply it to society.

He who knows that enough is enough will always have enough.

(Lao Tzu)

If you want to read more, you can go to my substack .

In any case, take care,

Hans