The new study, conducted with Chad Meyerhoefer of Lehigh University, estimates the effect of obesity on medical expenses by treating the heritable component of weight as a natural experiment. Previous research simply reported the difference between the medical expenses of heavier and lighter people, which is a misleading estimate of the causal effect because obese and non-obese individuals differ in so many ways. Cawley explained, “For example, I could have injured my back at work, and that may have led me to gain weight. The injury could have led to a lot of health care costs that are due to my back, not my obesity."
The research provides hard evidence for policymakers to use in cost-effectiveness analysis when deciding whether and how much to fund obesity prevention programs, Cawley said. Since previous studies have underestimated the medical costs of obesity, the economic rationale for governments to intervene and reduce obesity has been underappreciated.