Economic impact of Obesity in the United States

Obesity in United States


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Economic impact of Obesity in the United States

Obesity has grown out to be a major global issue in last several decades. It is a modern problem and statistics for it are not available if we search it for 40- 50 years back. Obesity can be defined simply as an imbalance between the intake of energy and its expenditure by the human body, which results in excess number of energy cells which are converted into fat cells.

There are several reasons behind getting obese, which include; easy availability and excessive intake of food, increase in number of labour saving devices which require less human effort, lack of exercise and new modes of transportations which don’t give a chance to people to walk and burn their calories etc.

Obesity of an individual is commonly expressed according to the body mass index (BMI), which is calculated by the dividing the weight in kilograms by the height in meter square. In adults, BMI is generally 3.0 or greater. BMI with values 25.0 to 25.9 is considered as overweight.

Obesity in United States

Americans are also suffering from this epidemic and today two-thirds of Americans are overweight. The rates of obesity in United States have doubled to over 30% since 1970 and percentage of those who are overweight or obese is reaching to epidemic proportions. It is affecting all segments regardless of gender, age or status. Currently 33% of U.S. adults are suffering from this life threatening diseases; consisting of 32.2% prevalence in men and 35.5% in women (Flegal, Carroll, Ogden et al., 2010).

According to WHO (World Health Organization) 1.6 million people were over weighted in United States in 2005, from which 400 million were obese

. It is predicted that by 2015, 2.3 million people will be overweight from which 700 million will be obese and will be defined by BMI > 30.

Ruhm (2007) also worked on increasing number of obese individuals in United States and estimated that 77.6% of men will be overweight in America by 2020, from which 40.2% will be obese. In case of women, 71.7% women will be overweight and from those, 43.3% will be obese. In another study, Ogden et al. (2007) compared the obesity occurrence between 2003-4 and 2005-6, in which they did not found any significant change in obesity prevalence. These were some of the facts regarding the increasing obesity in the United States.

This paper will explain the economic impact of obesity in United States and the issues faced by the men, women, children, and people belonging to all circles of life including economists, politicians and general public. Furthermore, it will also state possible solutions of the problems and ways to overcome the obesity issues.

Economic Impact of Obesity in United States

Obesity has a very deep impact on the economic conditions of United States. For instance:

1. The indirect economic cost of obese and overweight population in United States is $270 billion yearly due to:

a) the increasing expenses of medical care ($127billion),

b) loss of productivity of workers ($49 billion), disability of workers ($43 billion) and increase in the death rates ($72 billion)

c) Increasing cost of overweight persons $72 billion and total cost of obese persons $198 billion

2. Obese persons have 40% extra health care expenses than individuals that have normal weight

3. Disease that result due to obesity increase medical cost by 27%. According to an estimate, the medical expenses of United States for obesity and overweight people are 17% of U.S. medical costs (National Bureau of Economic Research)

4. According to nonpartisan Congressional Budget Office report of 2010, around 20% increase in the United States health care spending from 1987-2000 was due to the increasing obesity.

Following paragraphs will explain how obesity has such a deep impact on the economic condition of United States:

Direct Health Costs

One of the most significant economic impact of obesity from which general public suffers is an increase in direct health spending. Direct health care are the diagnostic and treatment services of individuals that are obese, these include; physician visits, nursing expenses, hospital expenses, home care, etc.). Direct health costs of obese patients increase significantly because obesity results in many serious illnesses and health conditions. These include; Type 2 diabetes, heart diseases, stroke, hypertension, cancer, osteoarthritis, infertility, gastro esophageal reflux disease, chronic headaches, cirrhosis of liver, asthma, sleep apnea (Pyle, 2006, p.361-376) etc.

According to Must, Spandano, Field et al., (1999), around 70 to 80% of adults that are obese suffer from diabetes, high blood pressures and high cholesterol. Diagnosis and treatment of these diseases increases the direct medical spending of public and these expenses continue to rise with the increasing levels of obesity. Secondly, the increasing of medical attention also plays a role in increasing the overall cost because the health insurance companies also increase their rates due to high demand .Several studies have proved that increase in obesity results in direct medical costs of the people.

Indirect Productivity Costs

A number of indirect costs, along with the direct medical costs, also increase due to obesity which together is part of the economic impact of obesity. Indirect costs are things like wages that are lost by the people who cannot work due to disability or illness. Similarly the value of future earnings can also be lost due to premature death of obese persons. Since obesity cause many diseases which prevent individuals from working and results in their early death, therefore, indirect productivity costs have been pointed out by many researchers as one of the factors that has a significant effect on the economy.

The studies also state that aggregate productivity loss and loss in several other sub-categories of productivity is also faced due to obesity. Many of these categories involve productivity loss that originates in the labor market; for instance due to absenteeism, i.e. when employees stay absent from work, because of obesity related diseases and problems. Another reason is the presenteeism, i.e. employees are at work but they don’t produce effectively due to obesity issues. Other productivity costs include; high rates of disability benefit payments, premature morality and welfare loss in the health insurance market.

Transportation Costs

Transportation cost is another cost in addition to medical and productivity which is affected by obesity. This is because increase in the body weight of Americans means that more fuel and larger vehicles will be needed for transporting same number of people which were earlier managed in small vehicles and less fuel. This has two effects; one is the increase in direct costs due to more spending on fuel and second is the increase in the potential indirect costs due to more greenhouse gas emissions.

Physocial Consequences

Emotional suffering is one of the painful aspects of life and unfortunately obesity results in many such serious psychosocial consequences. According to the U.S. department of health and human services, persons that are obese suffer more from low self-esteem and depression compared to the normal weight persons. This also affects their job performance at work place and increases the risk of social isolation and even suicide

In United States, physical appearance is considered very important, especially in case of women who are judged from their slimness and figure. It has been found in studies that women that were obsess had attended very few years of schools, very few of them were married, they had very low house hold incomes and high rate of poverty.

Overweight people in United States are perceived as lazy and inactive persons which are actually not the case. This judgment of society has a very devastating effect on the obese people. It badly effect all including students, teachers, doctors, politicians, social workers who are discriminated at the work place, in schools, colleges, universities and at such social places. This attitude of society gives these people feeling of embracement and they suffer from depression.

According to a study conducted in 1991 by Rand and Macgregor, all 100% of obese persons prefer to have other disease like diabetics, deadness, dyslexic, bad acne instead of becoming obese again. They all preferred to be smart and normal weighted persons instead of becoming a multimillionaire.

Human Capital Accumulation

Children and adolescents that are obese also suffer from serious psychological issues which impact their education and social functioning. Quality and quantity of schooling also has a significant economic impact as the rates of obesity in children increases. Different studies have been conducted by researchers to find out the change in human capital costs due to obesity, which have provided the statistical evidence, confirming the link between obesity and education experience of students.

Overall Impact of Obesity in United States

It can be concluded from above factors that obesity is the result of many social, cultural, behavioral, environmental and physiological factors. The overall impact of obesity in United States is considered to be significant as the total annual economic costs which are associated with obesity are in excess of $215 billion. The impact of such a huge figure obviously cannot be ignored and is therefore thoroughly discussed by many researchers in their studies.

Current United States Strategies to Solve the Obesity Problems

The Surgeon General’s Call to Action to Prevent and Decrease Overweight and Obesity (1991) explained many strategies that can be used to solve the issues of obesity

. These strategies together were called CARE, which means Communication, Action, Research and Evaluation.

The purpose of these strategies is to focus on giving physical education to all school classes, improving the options of food at the campuses and including low fat and low calorie items at the school events. They also suggest having more vegetables, fruits, non-fat, dairy products and whole grain items at these occasions. CARE strategies also emphasize that facilities should be provided to all the people for physical activity, everywhere, even at the work sites.

This plan further focuses that people of United States must reduce their television watching timings and should also change their behvaiour towards the obese people. Research on biological and behavioral causes of the obesity should be increased including focus towards the treatment and prevention of obesity. CARE aims to guide the health care providers and professional students on the prevention and treatment of obesity.

Possible Solutions of the Obesity Problems

According to Krugmen and Wells (2006, p.16), “When markets don’t achieve efficiency, government intervention can improve society’s welfare.” Obesity is also an important issue which needs government’s attention. Governments can play an important role in promoting better health to its people. For instance, they can help people in changing their life style by making new healthy options available to them or by working on existing options and making them accessible for the general public. Another alternative is to educate people and inform them about the healthy diet and its benefits, although this idea is expensive and it is difficult to convey the message. Another approach can be through regulations but it will then have an impact on all the consumers, therefore has high political and welfare costs. Moreover, it is also very difficult to organize and enforce it; it is a complex process, having an enforcement cost along with having conflicts with the industries.

The responsibility of solving the obesity issue is not only on the shoulders of government but private sector and employers must also play their role. These include the pharmaceutical companies, food industry and beverages industry. Furthermore, sports companies can also play positive role.

Governments are in a sense also dependent on the food and beverage industry and expect them to change the formulation of the food production in order to avoid the unhealthy ingredients, which include salts and fats. The size of the meals can also be reduced and healthy food should be provided. Promotion offers and advertising should be limited so that children and youth do not get attracted too much towards eating. Indeed focus should be given in the advertisements about concentrating on the ingredients of the food and beverages. Similarly as the cigarette makers also warn at the end of the advertisements that smoking is injurious to health (Mankiw, 2012, p.72).


Obesity cannot be reduced or removed in United States with the help of a magic sword. Its removal needs continuous education of people and change in life style along with proper education which guides people about its consequences. Government and private sector of United States should work together to take out Americans from this life threatening disease which is spreading day and by day without people being aware of its consequences.


Flegal, K., Carroll, M., Ogden, C., et al. (2010). Prevalence and trends in U.S. obesity among adults, 1999 — 2008.

Krugmen, P & Wells, R. (2006) .Macroeconomics, Princeton University, Worth Publishers.

Mankiw, G,. (2012). Principles of Macroeconomics. South Western Cengage Learning, 2012, 6th Edition, Printed in USA

Must a, Spadano J, Coakley EH, Field AE, Colditz GA, Dietz WH. (1999). The disease burden associated with overweight and obesity. 282(16):1523-29.

Ogden, Cynthia L., Carroll, M., McDowell, M., & Flegal, K. (2007). Obesity among adults in the United States {no statistically significant change since 2003-2004} Tech. Rep.,

National Center for Health Statistics.

Pyle, S.A., J. Sharkey, G. Yetter, E. Felix, M.J. Furlong, and W.S. Carlos Poston. (2006).

Fighting an epidemic: The role of schools in reducing childhood obesity. Psychology in the Schools 43(3): 361-376.

Rand, C. & MacGregor a. (1991). Successful weight loss following obesity surgery and the perceived liability of morbid obesity. 15: 577 — 579.

Ruhm, C. (2007). Current and future prevalence of obesity and severe obesity in the United

States. Forum for Health Economics and Policy 10(2).

Society of Actuaries. “Obesity and its Relation to Mortality and Morbidity Costs.” December 2010. Available from:

Centers for Disease Control and Prevention. “CDC Weight of the Nation Press Briefing.” July 2009 Available From:

National Bureau of Statistics, the Medical Care Costs of Obesity: An Instrumental Variables Approach

U.S. Department of Health and Human Services.The Surgeon General’s call to action to prevent and decrease overweight and obesity. [Rockville, MD]: U.S. Department of Health and Human Services, Public Health Service, Office of the Surgeon General; [2001]. / fact_consequences.htm.

Centers for Disease Control and Prevention. Physical Activity and Health: A Report to the Surgeon General. Government Printing Office, 1999. Available at: / adults.htm

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