The medical care costs of obesity: An instrumental variables approach
John Cawley () and
Journal of Health Economics, 2012, vol. 31, issue 1, 219-230
This paper is the first to use the method of instrumental variables (IV) to estimate the impact of obesity on medical costs in order to address the endogeneity of weight and to reduce the bias from reporting error in weight. Models are estimated using restricted-use data from the Medical Expenditure Panel Survey for 2000–2005. The IV model, which exploits genetic variation in weight as a natural experiment, yields estimates of the impact of obesity on medical costs that are considerably higher than the estimates reported in the previous literature. For example, obesity is associated with $656 higher annual medical care costs, but the IV results indicate that obesity raises annual medical costs by $2741 (in 2005 dollars). These results imply that the previous literature has underestimated the medical costs of obesity, resulting in underestimates of the economic rationale for government intervention to reduce obesity-related externalities.
Keywords: Obesity; Externalities; Medical care costs; Insurance (search for similar items in EconPapers)
JEL-codes: D6 I1 I14 I18 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (225) Track citations by RSS feed
Downloads: (external link)
Full text for ScienceDirect subscribers only
Working Paper: The Medical Care Costs of Obesity: An Instrumental Variables Approach (2010)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eee:jhecon:v:31:y:2012:i:1:p:219-230
Access Statistics for this article
Journal of Health Economics is currently edited by J. P. Newhouse, A. J. Culyer, R. Frank, K. Claxton and T. McGuire
More articles in Journal of Health Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().