Discussion Paper Details

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Title: Obesity and Price Sensitivity at the Supermarket

Author(s): Neil Gandal and Anastasia Shabelansky

Publication Date: September 2009

Keyword(s): Obesity and Price Sensitivity

Programme Area(s): Public Economics

Abstract: In this paper, we employ a rich data set at the individual level in order to examine which factors are most highly correlated with obesity. Our main result is that, even after controlling for income levels and other factors, we find that high 'price-sensitivity' for food products is associated with high obesity rates. We find that a woman who stated that prices were 'not important at all' when purchasing food products had a Body Mass Index (BMI) that was 1.3 units below those who stated that price was 'very important.' This suggests that the price effect is not trivial and obesity is a problem that is not limited to those with low income levels. A 1.3 unit reduction in the BMI would move approximately 28% of women who are in the 'overweight' category to the 'normal weight' category and 25% of women who are in the 'obese' category to the 'overweight' category.

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Bibliographic Reference

Gandal, N and Shabelansky, A. 2009. 'Obesity and Price Sensitivity at the Supermarket'. London, Centre for Economic Policy Research.