Study: Obesity, Farm Policy Not Linked

All that you may have heard is apparently false, and driving farm policy by 'dietary worries' could limit ag innovation too.

Published on: Mar 27, 2012

Prominent nutritionists, journalists and politicians like to point the finger at U.S. farm subsidies by saying they have contributed significantly to the nation's "obesity epidemic" by making fattening food relatively cheap and abundant while asserting that reducing these subsidies will go a long way toward solving the problem.

This argument was one of the main points author Michael Pollan made in The Omnivore's Dilemma and was featured in the film "Food, Inc.

However, work by economists Bradley J. Rickard, Abigail M. Okrent and Julian M. Alston has taken a close look at any links that might exist among farm policy, food prices and obesity in the U.S. and found that U.S. subsidy policies for agricultural commodities have had only very small effects on obesity.

NO BELLY BUSTER: New study shows that farm policy has little to do with Americas waistline.
NO BELLY BUSTER: New study shows that farm policy has little to do with America's waistline.

In the case of corn, which is blamed most often for contributing to obesity, the economists determined that farm subsidies are not at all the culprit they are made out to be. Rather, they said, U.S. sugar policy has restricted imports, driven up the national price of sugar and encouraged consumers and food manufacturers to replace sugar with alternative high-calorie sweeteners, especially high-fructose corn syrup.

"A simplistic model of farm subsidies and obesity, which is implicit in some writings on the subject, presumes a textbook subsidy policy that results in an increase in both production and consumption of the subsidized good by increasing the net return to producers -- the market price plus the subsidy -- and lowers the market price paid by consumers. However, the main elements of U.S. farm subsidy programs are significantly different from the simplistic textbook subsidy policies," the economists said.

Their finding was driven by three key factors. First, with a few exceptions, farm subsidies have relatively small and mixed effects on prices of farm commodities in the U.S. Second, the share of the cost of commodities in the cost of retail food products is small and continues to shrink over time. Third, food consumption patterns do not change substantially in response to small changes in food prices.

The results the economists found across a range of scenarios showed that the impact of farm policy is small and mixed such that the net effects are ambiguous.

In fact, eliminating all farm subsidy policies, including trade barriers, would decrease consumption of some food products but increase consumption of other food products, most likely leading to an increase in overall calorie consumption, they said, estimating that the typical American adult would actually respond by eating about 3,000-3,900 additional calories per year.

They said cutting back on grains and meats would be more than offset by the consumption of more sugar and dairy products, which are more calorie dense. That's the opposite effect of what farm subsidy opponents predicted, but it's still a very small one given that the typical adult requires on the order of 2,000-2,500 calories daily, they said.

"In other words, contrary to common claims in the popular media, farm policies have more likely slowed the rise in obesity in the U.S., but any such effects are small," the economists said. "Compared with other factors, the policy-induced differences in relative prices among various farm commodities have played only a tiny role in determining excess food consumption and obesity in the U.S."

What does this mean for policy-makers?

The economists said it is quite simple: Policy-makers will need to strive to find other more effective and more economically rational ways to reduce the social consequences of excess food consumption while at the same time enhancing consumption opportunities for the poor and protecting the world's resources for future generations.

The work by Rickard, Okrent and Alston has appeared in the official publication of the Agricultural & Applied Economics Assn. and numerous other journals over the past several years.

Rickard is with the Charles H. Dyson School of Applied Economics & Management at Cornell University in Ithaca, N.Y.; Okrent is with the U.S. Department of Agriculture's Economic Research Service, and Alston is with the department of agricultural and resource economics at the University of California-Davis.

Check out an audio interview with Cornell University researcher Brad Rickard:

Sarah Muirhead is editor, Feedstuffs¸ a sibling publication to Farm Futures and the Farm Progress family of magazines.