The link between obesity and the commiserable US minimum wage
Submitted by Eternity on Thu, 11/12/2009 - 13:48.
Max Eternity - Measured in 2008 dollars, in 1968 the minimum wage was $9.15, and it is for this reason two economist--David O. Meltzer and Zhuo Chen--have authored a paper entitled "The Impact of Minimum Wage Rates on Body Weight in the United States" making the case that at least 10% of the overall obesity increase in America comes as a direct result of last wages over the past 30 years. The summary for the paper states:
Growing consumption of increasingly less expensive food, and especially “fast food”, has been cited as a potential cause of increasing rate of obesity in the United States over the past several decades. Because the real minimum wage in the United States has declined by as much as half over 1968-2007 and because minimum wage labor is a major contributor to the cost of food away from home we hypothesized that changes in the minimum wage would be associated with changes in bodyweight over this period. To examine this, we use data from the Behavioral Risk Factor Surveillance System from 1984-2006 to test whether variation in the real minimum wage was associated with changes in body mass index (BMI). We also examine whether this association varied by gender, education and income, and used quantile regression to test whether the association varied over the BMI distribution. We also estimate the fraction of the increase in BMI since 1970 attributable to minimum wage declines. We find that a $1 decrease in the real minimum wage was associated with a 0.06 increase in BMI. This relationship was significant across gender and income groups and largest among the highest percentiles of the BMI distribution. Real minimum wage decreases can explain 10% of the change in BMI since 1970. We conclude that the declining real minimum wage rates has contributed to the increasing rate of overweight and obesity in the United States. Studies to clarify the mechanism by which minimum wages may affect obesity might help determine appropriate policy responses.