19 Pages Posted: 3 Jul 2004
In the debate over increasing obesity rates, fingers are often pointed at big food and their marketing practices. It is noted that restaurant meals are often larger than home-cooked meals and that portion sizes in restaurants have dramatically increased over the past few years. We investigate the issue by considering socially optimal - rather than decentralized profit maximizing - portions in restaurants to see whether welfare maximizing strategies may also be waistline-increasing. We demonstrate that socially optimal restaurant meals are larger in size than average home-cooked meals and, while many agents chose to super-size, the option of super-sizing actually alleviates the size discrepancy between home-cooked and restaurant meals. Moreover, socially optimal portion sizes at home and in restaurants increase with relative reductions in the marginal costs and/or relative increases in the fixed costs of meal preparation. Given this cost structure, when offered fries, a greater proportion of the population will answer with an enthusiastic yes!
Keywords: Obesity, Overweightness, Economics of Obesity, Fast Food, Big Food, Consumption Choices
JEL Classification: I10, D11
Suggested Citation: Suggested Citation
Jeitschko, Thomas D. and Pecchenino, Rowena, Do You Want Fries with That? An Exploration of Serving Size, Social Welfare, and Our Waistlines. Available at SSRN: https://ssrn.com/abstract=560981 or http://dx.doi.org/10.2139/ssrn.560981