Abstract

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Lose Some, Save Some: Obesity, Automobile Demand, and Gasoline Consumption in the U.S.


Shanjun Li


Cornell University - School of Applied Economics and Management

Yanyan Liu


World Bank

Junjie Zhang


University of California, San Diego

June 25, 2009


Abstract:     
This paper examines the unexplored link between the prevalence of overweight and obesity and vehicle demand in the United States. Exploring annual sales data of new passenger vehicles at the model level in 48 U.S. counties from 1999 to 2005, we find that new vehicles demanded by consumers are less fuel-efficient on average as a larger share of people becomes overweight or obese. The OLS results show that a 10 percentage point increase in obesity and overweight reduces the average MPG of new vehicles demanded by 1.4 percent, an effect requiring a 12 cent increase in gasoline prices to counteract. The 2SLS results after controlling for possible endogeneity in overweight and obesity prevalence put those two numbers at 5 percent and 54 cents, respectively. These findings, robust to a variety of specifications, suggest that policies to reduce overweight and obesity can have additional benefits for energy security and the environment.

Number of Pages in PDF File: 41

Keywords: Obesity, fuel economy, gasoline consumption, vehicle demand

JEL Classification: Q50, R41, L62

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Date posted: June 26, 2009 ; Last revised: January 20, 2014

Suggested Citation

Li, Shanjun and Liu, Yanyan and Zhang, Junjie, Lose Some, Save Some: Obesity, Automobile Demand, and Gasoline Consumption in the U.S. (June 25, 2009). Available at SSRN: http://ssrn.com/abstract=1425773 or http://dx.doi.org/10.2139/ssrn.1425773

Contact Information

Shanjun Li (Contact Author)
Cornell University - School of Applied Economics and Management ( email )
248 Warren Hall
Ithaca, NY 14853
United States
Yanyan Liu
World Bank ( email )
1818 H Street, NW
Washington, DC 20433
United States
Junjie Zhang
University of California, San Diego ( email )
9500 Gilman Dr #0519
La Jolla, CA 92093
United States
858-822-5733 (Phone)
HOME PAGE: http://irps.ucsd.edu/junjie/
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