Health Concerns and Socio-Economic Determinants: Analysis and Evaluation in Italy and England

This thesis analyses various aspects related to the economic determinants of obesity in two EU countries, Italy and the UK, which are of interest for different reasons. Although much later with respect to the United States and some continental European countries, the issue of the rise of weight has also become significant in Italy, where, 34.2% of adults were classified as overweight and 9.8% as obese in 2005. These percentages were found to differ greatly according to age, gender, years of education and income level. Moreover, the percentage of adults classified as obese has risen by 4 percentage points in the last decade as shown by ISTAT. This measure becomes more relevant when we consider that the obesity and overweight rate increased in the same period by 9 percentage points. In the UK, the increase in obesity is found to be similar to that of the United States although it started from a lower level. The percentage of obese individuals is about 24% in 2007 and is among the highest in Europe. The trends of obesity in aggregate have constantly risen over the last fifteen years (15% since 1993), similarly for both men and women. This persistent growth suggests that, at least, some causes may have become structural in determining obesity in the UK, but also in Italy. The reasons for the significant increase in the obesity levels for the two countries analysed may be of various nature. We decided to focus our attention on the role of food prices in Italy, where the healthy properties of the Mediterranean diet have, up to now, mostly influenced the low obesity rates in the country. It becomes then of crucial importance to document any significant variation, in terms of food onsumption, that may be responsible for the general increase in obesity and overweight rates. While for the UK, this research is related to a number of empirical papers testing overweight as the result of several socio-economic changes which have altered people’s lifestyle choices. In particular, we examined the consequences of changes in relative prices and in the density of different types of restaurants on obesity, as well as the influence of cigarette consumption. We also refer to the effects of technological changes, which are responsible for shifts over time in employment from agricultural and manufacturing to services, implying a decrease in the strenuousness of jobs, and in the number of hours dedicated to physical exercise. Agricultural innovations are also responsible for reductions in the price of food and consequently of calories. Another very important determinant of the obesity epidemic is related, by the health economic literature, to the recent drastic reduction in smoking habits. Many previous works have documented a very clear inversion between the trends of smoking, which have constantly reduced, and BMI, which documented a sharp increase. However all these works did not provide a general agreement on the sign and the magnitude of these effects, and most importantly they did not provide a clear estimate of these effects on obese individuals. We take advantage of the introduction of the Clean Indoor Air Law, which prohibits smoking in public places, implemented in Italy as from 10 January 2005, to identify the relationship between smoking behavior and body weight within a regression discontinuity design. In the case of the UK, we took advantage of the longitudinal framework of the BHPS and estimate a difference-in-differences (DID) model to account for individual fixed-effects related to individual health concerns and estimate the parameters of the DID model using a battery of control groups. We also performed IV and IVQR estimates for the average treatment effects (ATEs) and quantile treatment effects (QTEs) estimators to take into account properly issues related to endogeneity.