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Obesity and the growth model

ObesityObesity it turns out is actually good for the economy. More consumption of food, particularly processed food, contributes to more economic growth. Poor health, strangely enough, can be considered an economic bonus. Bad food, too much food and drink, might be tragic in health terms but when it comes to the economy it would seem that obesity pays. But obesity doesn’t pay when it comes to the natural capital of the planet. Some economists have seen this obesity issue as indicative of wider economic, environmental and social problems. They take the economic argument one step further and link obesity to greenhouse gas emissions. Unnecessary over consumption of food is putting pressure on the environment through farming and manufacturing processes and hence contributing to its degradation.

There is proof to support the belief that while economic development is for the most part undoubtedly associated with human health, this is not always the case. The measure of economic growth – GDP – the value of the output of goods and services, does not consider the negative contributions that it might make to an economy. Ten percent of the developed world is made up of drug alcohol and cigarette sales and dealing with all these, medically of course, adds to the GDP and it is ironic that some cigarette manufacturers also produce surgical equipment and therefore making and doubling the benefit for GDP from smoking.

However growth is related to people living longer and this has been apparent with the improvements in healthcare in developed countries over the last century. In the developing world there has been a change from a high presence of infectious diseases to that of persistent illnesses including heart disease, strokes etc and is reflected, in some cases, in a disability for life. According to Garry Egger and Boyd Swinborne obesity is not a disease but a signal. It’s the canary in the coalmine, which should alert us to bigger structural problems in society. There are a number of areas where humans have achieved a peak of success, a sweet spot, but now that very success is turning on us and threatening to unravel centuries of achievement.

On the one hand, economic growth has over centuries led to a steadily improving standard of living, better levels of health and ever increasing life spans. In economic terms this reflects the start of a point of diminishing marginal rates of return from continued investment in the growth model.

Diminishing rates of return for the growth model

Mortality and economic growth data collected on the Swedish economy between 1800 to 2000 has shown the commencement of a diminishing rate of return on economic growth in relation to mortality rates. This coincides, not unexpectedly, with the leveling of improvements in health made from the decrease in infectious diseases associated with development, but with the consequent increase in chronic diseases associated with modern lifestyles, driven as they are by the modern environment. It is this switch, from predominantly infectious disease, to lifestyle-related chronic disease, and the consequent breakdown in the human immune system that differentiates the early from late stages of economic development. Several developing countries, such as China and India, appear to be experiencing this issue of chronic disease and at a more rapid pace because of their levels of GDP. In China for instance more than a quarter of the adult population are overweight or obese, as people add more meat and dairy products to their diet, causing chronic disease. According to a study in the Journal of Health Affairs “we need to find the right investments and regulations to encourage people to adopt a healthy lifestyle, or we risk facing higher rates of death, disease, and disability and the related costs.”

The reverse applies to Cuba where they experienced improved health conditions with the withdrawal of the Soviets in 1989. Over the next decade there was a significant improvement in health:

• Decrease in food intake of 1000 kcal/day average
• Mortality rate decrease by 20%
• Obesity reduced by approximately 50%
• Deaths from heart disease reduced by 35%
• Deaths from stroke reduced by 18%

Final thought
It seems to be apparent that the current economic growth system cannot keep going in perpetuity. As developed economies grow there comes a point where there is a diminishing marginal rate of return on investment in terms of climate change and in particular human health. As Keynes indicated at the Bretton Woods conference in 1944 this current model of economics, ie. growth driven, will need to change in the next 100 years.

References:

Obesity, Chronic Disease, and Economic Growth: A Case for “Big Picture” Prevention by Garry Egger http://www.sage-hindawi.com/journals/apm/2011/149158/

Radio New Zealand – 30-1-11 Interview with Garry Egger

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