How to raise revenue and cut childhood obesity in one fell swoop

December 28, 2012
Nothing in this post should be construed as implying that you should not eat the pretzel-fried pickles at The Pinch in Columbia Heights, which are like oily manna from the Gods. (Kristin M./Yelp)

It should come as no surprise to anyone with a television that advertising for fast food joints and snack foods can be mighty persuasive. A new working paper by public health economists Michael Grossman, Roy Wada, and Erdal Tekin tries to quantify exactly how persuasive, and what this means for public health.

Previous studies have mainly focused on the persuasiveness of junk food advertising to children. Not too surprisingly, the previous literature found that kids were pretty impressionable. One study found that watching 100 ads for soft drinks over a three-year period was associated to a 9.4 percent increase in soda consumption. Another, coauthored by Grossman, found that banning fast food advertising would reduce childhood obesity by 10 percent.

The new paper reproduces Grossman's earlier calculations and reaches very similar conclusions. What's more, it finds that banning fast food ads reduces obesity when measured using percent body fat (PBF), which many experts consider a better metric to body-mass index (BMI), upon which Grossman's earlier study relied. Using PBF, the effects of an advertising ban are even larger. A PBF-based calculation suggests that a ban would reduce the number of obese youths by 14 percent, while Grossman et al's most recent BMI-based calculation found a reduction of only 6 percent.

These studies are correlational and not randomized, so even though they control for factors such as children's proximity to fast food and the relative prices of fast food and healthy food, one can't be too certain in drawing definitive conclusions from them. But if they're hitting on a real causal relationship, they suggest that regulatory measures against fast food advertising could make a big dent in childhood obesity.

Of course, a complete ban on fast food advertising would require some heavy political lifting. That's why Grossman has also prepared estimates of what would happen if businesses were banned from counting the costs of fast food advertising as a business expense for tax purposes. His previous study found that would reduce childhood obesity by 3 to 5 points; the new study doesn't have a numerical estimate, but describes the effects as "non-trivial." That's be a way to crack down on advertising and make a dent in obesity without raising free speech issues, and while raising revenue for good measure.

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Sarah Kliff | December 28, 2012