Restaurants, Regulation, and the Supersizing of America: Empirical Evidence Challenges the Belief That Increased Restaurant Dining Is the Cause of American Obesity

By Anderson, Michael L.; Matsa, David A. | Regulation, Fall 2010 | Go to article overview

Restaurants, Regulation, and the Supersizing of America: Empirical Evidence Challenges the Belief That Increased Restaurant Dining Is the Cause of American Obesity


Anderson, Michael L., Matsa, David A., Regulation


Obesity rates in the United States have grown rapidly in recent years, and obesity has become a leading cause of preventable death. Medical research has linked obesity to diabetes, heart disease, stroke, and certain cancers. But while obesity represents a serious and growing health issue, its underlying causes are not well understood.

One popular idea among public health advocates is that eating restaurant food causes obesity. Restaurant food is often rich and portion sizes tend to be large. Concerned policymakers are developing new regulations on restaurants in an effort to fight obesity. For example, in response to high obesity rates in low-income neighborhoods, the Los Angeles City Council unanimously approved a law in July 2008 banning the opening of new fast food restaurants in a 32 square-mile area containing 500,000 residents. "Calorie posting" laws are in effect in cities such as New York and Seattle, and the recent health care reform bill mandates calorie posting for all chain restaurants with 20 or more outlets.

If large portions and effective marketing lead people to eat more when they go to restaurants than when they eat at home, then these regulations may reduce obesity. But it is not obvious that the link between eating at restaurants and obesity is causal. The increasing prevalence of restaurants may in part reflect a greater demand for calories.

The case against restaurants centers on correlations showing that the frequency of eating out is positively associated with greater fat, sodium, and total energy intake, as well as with greater body fat. These correlations have been reproduced in a broad range of data sets and study populations. Furthermore, the number of restaurants and the prevalence of obesity have been rising for a number of decades. But simple correlations between restaurant visits and overeating may conflate the impact of changes in supply and demand. People choose where and how much to eat, leaving restaurant consumption correlated with other dietary practices associated with weight gain. A key question is whether the growth in eating out is contributing to the obesity epidemic, or whether these changes merely reflect consumer preferences. The interesting causal parameter is how much more an obese person consumes in total because he or she ate at a restaurant. If changes in preferences are leading consumers to eat out more, regulating restaurants may only lead consumers to shift consumption to other sources rather than to reduce total caloric intake.

EMPIRICAL RESEARCH DESIGN

In a paper forthcoming in the American Economic Journal: Applied Economics, we reexamine the conventional wisdom that restaurants are making America obese. We assess the nature of the connection between restaurants and obesity by exploiting variation in the supply of restaurants and examining the impact on consumers' body mass. In rural areas, interstate highways provide variation in the supply of restaurants that is arguably uncorrelated with local consumer demand. To serve the large market of highway travelers passing through, a disproportionate number of restaurants locate immediately adjacent to highways. For residents of these communities, we find that the highway boosts the supply of restaurants (and reduces the travel cost associated with visiting a restaurant) in a manner that is plausibly uncorrelated with demand or general health practices. To uncover the causal effect of restaurants on obesity, we compare the prevalence of obesity in communities located immediately adjacent to interstate highways with the prevalence of obesity in communities located slightly farther away.

[ILLUSTRATION OMITTED]

The estimates suggest that restaurants--both fast food and full service--have little effect on adult obesity. The differences in obesity rates between communities adjacent to highways and communities farther from highways are close to zero and precise enough to rule out any meaningful effects. …

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