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Globalization and Obesity in Developing Countries
Andrew Jacobs and Matt Richtel, “How Big Business Got Brazil Hooked on Junk Food”, New York Times, 9/16/2017 Matt Richtel, “More Than 10% of World’s Population Is Obese, Study Finds”, New York Times, 6/12/2017 The GBD 2015 Obesity Collaborators, “Health Effects of Overweight and Obesity in 195 Countries Over 25 Years”, New England Journal of Medicine, 7/06/2017 WHO Press Report, “Ultra Processed Foods are Driving the Obesity Epidemic in Latin America”, 9/01/2015:
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More Than 10% of World’s Population is Obese
73 countries have seen obesity rates double from Researchers find evidence linking excess weight to ~4 million deaths in 2015 The per capita death rate is up 28% since 1990, 40% of the deaths were among people classified as overweight. Obesity rates are rising faster among children than adults.
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Obesity Data Visualization Tool
*Institute for Health Metrics and Evaluation
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*Andrew Jacobs and Matt Richtel, “How Big Business Got Brazil Hooked on Junk Food”, New York Times, 9/16/2017
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% Change in Disability Adjusted Life Years and Deaths From High BMI (1980-2015)
From Figure 4 in: The GBD 2015 Obesity Collaborators, “Health Effects of Overweight and Obesity in 195 Countries Over 25 Years”, New England Journal of Medicine, 7/06/2017
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How Big Business Got Brazil Hooked on Junk Food
Fast food sales have grown 30% world wide, compared to 20% in the US. (from Euromonitor, cited in NYT) Sales of packaged food grew 25% worldwide, compared to 10% in the US. (from Euromonitor, cited in NYT) Carbonated soft drink sales have doubled in Latin America since 2000, overtaking sales in North America. (WHO press release) As of 2015, in Latin America, two MNCs held approximately of carbonated soft drinks and sweet & savory snacks sales. (WHO press release) By volume, sales of ultra processed food & beverage products has increased ~48% between and 2013 in Latin America (compared w/ 2.3% in North America). (WHO press release)
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The Blame Game New York Times Multi-National Company (MNC)
Multi-national food companies are aggressively expanding their presence in developing nations, unleashing a market juggernaut that is upending traditional diets and contributing to a new epidemic of diabetes/heart disease. Processed food products have helped alleviate hunger and provide critical nutrients to people in need. Processed food is a normal good.
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Things to Consider… MNCs expanding operations into the developing world has the potential to disrupt local agriculture. An increased presence of large organizations in the developing world will likely create increased political influence. PPP adjusted world per capita GDP has been consistently increasing for the past 30 years (World Bank Development Indicators). World poverty rates (as measured by the % of people living off of $1.90 a day or less) have been consistently decreasing for the past 30 years. So has malnutrition in children 5 and under (World Bank Development Indicators). There are many factors besides food environment which can contribute to weight gain (e.g. reduction in activity levels).
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A Tale of Two Objective Functions
Let: 𝑆𝐶(𝑄)=𝑃𝐶(𝑄)±𝐸𝐶(𝑄) 𝑆𝐵 𝑄 =𝑃𝐵 𝑄 ±𝐸𝐵(𝑄) Thus: 𝑁𝐵 𝑄 =𝑆𝐵 𝑄 −𝑆𝐶(𝑄) FOC: 𝑑𝑆𝐵 𝑑𝑄 = 𝑑𝑆𝐶 𝑑𝑄 However, decision makers optimize over private considerations. So, this will only be the outcome in the absence of an external effect. If the consumption of processed food creates a negative external benefit (i.e. a negative externality), the resulting market allocation could exceed the socially optimal.
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