The Cost of Obesity

Being obese or overweight is one of the most serious public health problems of the 21st century; it is the fifth leading risk for global deaths according to the World Health Organization (WHO). Yet it is completely preventable. The problem seems to be related to wealth; the WHO also reports that levels of obesity in high- and upper middle-income countries are more than three times higher than in lower middle income countries although the problem is rising dramatically for the latter.

Obesity is medically defined as the state in which a person’s body mass index (BMI), obtained by dividing their weight by the square of their height, exceeds 30 kilograms per meter squared. The amount of body fat carried by someone with this BMI affects their health and life expectancy. The most common associated diseases are coronary heart disease, type-2 diabetes and high blood pressure, but there are also many others such as osteoarthritis and certain types of cancer. The result has a detrimental effect not just on the individual, but also on the economy as a whole.

Most directly, there are the costs of the medical care needed to treat the associated diseases. A 2013 United States’ National Bureau of Economic Research (NBER) working paper by John Cawley and Chad Meyerhoefer of Cornell and Lehigh Universities, respectively, found that in 2005 the U.S.A. spent US$190 billion on obesity-related treatments, around 17 percent of the total national spending on health care, and almost four times the amount the U.S.A. gave in foreign aid in 2011.  

And healthcare costs are not the only ones. Obesity also costs a country’s economy in terms of lost working productivity due to medical visits, disability, and premature death. These indirect costs are harder to measure than those of medical care, but estimates are available. Data from the 1994 United States National Health Interview Survey(NHIS), for example, found the cost of lost productivity due to obesity to be $3.9 billion. That is a small amount relative to the costs of obesity-related health care, but it is equivalent to 39.2 million days of lost work in a year.

Obesity is a frustrating problem because it is entirely preventable and highly unequally distributed in the world: according to a 2012 report from the Food and Agriculture Organization (FAO) of the United Nations (UN), the number of overweight adults in the world (more than 1.4 billion) far exceeds the total number of people who are undernourished (864 million). Even more surprising is that in some low and middle-income countries, there is a significant prevalence of both obesity and undernutrition, the latter being characterized by the stunted growth of children under five. In Egypt for example, around 30 percent of the population is obese, and roughly the same percentage is undernourished. Something should be changed in our food production and distribution systems to rectify this situation.

The process of a country moving from a state of prevalent undernutrition to overnutrition is described by the ‘nutritional transition,’ a concept first proposed by American professor Barry Popkin, currently at the Carolina Population Center (CPC) of the University of North Carolina (UNC), in his 1993 paper ‘Nutritional Patterns and Transitions‘. The nutritional transition is the state of moving from ‘natural’ dietary habits involving the consumption of a large quantity of fresh plant-based foods, to a typically modern ‘Western’ diet with a large amount of processed foods and animal products. The transition takes place as a country undergoes shifts towards development: decreasing birth-rate and infant mortality, and increasing quality of healthcare and sanitation. One of the biggest factors causing dietary change is migration from the countryside to cities. Urban areas have better transport and food distribution systems than rural areas, and work that is conducted away from home, may limit the time available for preparing meals at home. These, and other reasons including aggressive profit-driven advertising by fast-food companies, lead to a higher consumption of ready-made processed foods and meat products, high in sugar, salt and fat. Coupled with the often sedentary urban lifestyle of motorized transport and desk-based jobs, the stage is all set for obesity to rise.

Brazil has undergone phases of very rapid development and this provides a useful case study of this phenomena. Its average rate of Gross Domestic Product (GDP) growth peaked at 14 percent in 1973, averaging 8.5 percent over the course of the 1970s and 3.0 percent over the next decade. This economic growth was accompanied by a rise in obesity. A 2002 paper by Professor Popkin examined the ‘Trends of obesity and underweight in older children and adolescents in the United States, Brazil, China, and Russia‘ comparing the rates in 1974 with those in 1997. They found

“a notable shift away from undernutrition toward overnutrition in all countries except Russia and a remarkably similar average annual increase in the prevalence of overweight in Brazil and the United States.”

So, who exactly is it that becomes obese? A public health review published by the WHO reports on the link between obesity and socioeconomic status (SES). In the 1980s, evidence showed that obesity in lower-income countries was associated with those of high SES. Partly this is because bigger body shapes are considered to be attractive in some cultures, so if you can afford to buy and eat extra food then you may do so to make yourself more attractive. But also it was an indication that being fat used to be (and in some cases, still is) a status symbol – it proved that you had sufficient money to be able to afford to eat more than you actually needed. However, studies from the 1990s showed that obesity in developing countries shifted towards groups with lower SES as the nation’s wealth increased. In other words, in the early stages of development, the poorest people suffer from undernutrition, whilst in the later stages of development they suffer from being overweight and obese. One of the possible reasons for this is the existence of ‘food deserts’ (regions where healthy foods are inaccessible) in low-income urban areas; this and other reasons are discussed in this previous post. In order to protect these low-income groups, food education schemes such as the Liberty’s Kitchen enterprise in New Orleans, which makes school food healthier, are being initiated.

Obesity is wasteful in every sense – not just in terms of finance and productivity, but also in terms of human health and life. It is no longer just a problem in developed countries but is rapidly becoming more prevalent in developing countries around the world. We have a food system in which unhealthy processed food is often cheaper than fresh, nutritious food. Not only does this affect the welfare of the individual, but is also a problem for the economy as a whole, and possibly even impeding development. And the problem is completely preventable if policy makers changed the food production and marketing system to one that is geared towards health and not just profit.

What effect do you think obesity has on the economy? Please leave a reply below.

Tracey Li is a Research and Communications Intern with INESAD.

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For your reference:

Barness, LA, Opitz, JM, Gilbert-Barness, E 2007, ‘Obesity: genetic, molecular and environmental aspects’, Am J Med Genet A. 2007 Dec 15, 143A (24), pp. 3016-34. <>

Crawley, J, Meyerhoefer, C 2010, ‘The Medical Care Costs of Obesity: an Instrumental Variables Approach’, J Health Econ., 31, pp. 219-30. <>

Popkin, BM 1993, ‘Nutritional Patterns and Transitions’, Population and Development Review, Vol. 19, No. 1. <>

Wang, Y, Monteiro, C, Popkin, BM 2002, ‘Trends of obesity and underweight in older children and adolescents in the United States, Brazil, China, and Russia’, Am J Clin Nutr, vol. 75, no. 6, pp. 971-977. <>

Wolf, AM, Colditz, GA 1998, ‘Current Estimates of the Economic Cost of Obesity in the United States’, Obesity Research, 6, pp. 97-106. <>

Food and Agriculture Organization, WFP and IFAD 2012, The State of Food Insecurity in the World 2012. Economic growth is necessary but not sufficient to accelerate reduction of hunger and malnutrition. <>

Index Mundi, Brazil – GDP growth. <>

USAID, U.S. Overseas Loans and Grants, Foreign Assistance Fast Facts: FY2011. <>

World Health Organization, Global Health Observatory (GHO), Obesity. <>

World Health Organization, Health topics, Obesity. <>

World Health Organization, Media Centre Fact sheet 311 May 2012, Obesity and overweight. <>

Bulletin of the World Health Organization, vol. 82, no. 12, Socioeconomic status and obesity in adult populations of developing countries: a review. <>




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