Intertemporal discounting as a risk factor for high BMI: Evidence from Australia, 2008 Mark C. Dodd * School of Economics, University of Adelaide, SA 5005, Australia 1. Introduction Body weight outcomes, although mediated by genetic and biological factors, are determined to a large extent by lifestyle choices such as diet and exercise. These choices involve a trade-off between immediate pleasure and expected future wellbeing since a large part of the health costs of weight gain occur in the future. Discounted utility theory, as introduced by Samuelson (1937), models intertemporal choice by supposing a ‘discount rate’ across time periods that puts a declining value on utility that is further in the future. Many health related choices can usefully be modelled as investment decisions, which has been common practice since the model of health capital was introduced by Grossman (1972). This model was itself inspired by Becker’s model of human capital (Becker, 1964), and in turn has resulted in many modernizations and extensions (e.g. Muurinen, 1982; Liljas, 1998; Ehrlich, 2000; Gross- man, 2000). There is also a burgeoning literature of theoretical models particularly tailored to body weight. Some of these models that explicitly include intertemporal discount rates include: Levy (2002), Philipson and Posner (2003), and Lakdawalla et al. (2005). The theory of discounting and body weight has also been discussed within various papers, such as Cutler et al. (2003) and Blaylock et al. (1999). It is a common feature of these models that a higher discount rate leads to lower investment in health capital, or a higher body weight, based on the simple logic that future health costs will be discounted more than present consumption benefits. Perhaps the first study to attempt to empirically link intertemporal discounting with health outcomes was Fuchs (1982), using choices over hypothetical monetary values to elicit discount rates, and looking at smoking, weight, exercise activity, health care utilization and use of Economics and Human Biology 12 (2014) 83–97 A R T I C L E I N F O Article history: Received 21 May 2012 Received in revised form 9 May 2013 Accepted 9 May 2013 Available online 29 May 2013 Keywords: Intertemporal discounting Obesity Body mass index (BMI) Quantile regression A B S T R A C T This paper explores the relationship between intertemporal discounting and body weight, using stated preference measures of intertemporal discounting, and the body mass index (BMI) to represent relative body weight. The empirical analysis uses Australian data obtained in 2008 through the South Australian Health Omnibus Survey. A quantile regression analysis is used to allow the marginal effects of the explanatory variables on BMI to vary across the conditional BMI distribution. It is shown that an indicator of intertemporal discounting elicited from a hypothetical monetary trade-off has a significant positive relationship with BMI. This relationship appears to be stronger in the upper quantiles, but there is insufficient statistical evidence for this difference. Evidence is presented that intertemporal discounting is a risk factor for increased BMI with a magnitude of effect comparable to more commonly recognized risk factors such as income and education. However there is no significant relationship found between BMI and an alternative indicator of intertemporal discounting elicited from trade-offs in health status. ß 2013 Elsevier B.V. All rights reserved. * Tel.: þ61 8 8313 4931. E-mail address: mark.dodd@adelaide.edu.au. Contents lists available at SciVerse ScienceDirect Economics and Human Biology jo u rn al ho m epag e: h ttp ://ww w.els evier.c o m/lo cat e/ehb 1570-677X/$ – see front matter ß 2013 Elsevier B.V. All rights reserved. http://dx.doi.org/10.1016/j.ehb.2013.05.005