Obesity’s Economic Impact

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This examines the increased prevalence of obesity in the context of market failure. In welfare economics, market failure is an important precondition for government intervention. Obesity in the United States has risen dramatically in the last several decades; over two thirds of American adults are overweight, and one third is obese. Obesity is a risk factor for a wide range of health conditions, including heart disease, diabetes, cancer, stroke, and osteoarthritis. In addition to the significant human costs, there are economic ramifications to the sequelae of obesity, such as increased costs associated with healthcare, disability and absenteeism.