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Using Behavioral Economics to Bring about Diet and Food Consumption Change

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Using Behavioral Economics to Bring about Diet and Food Consumption Change Powered By Docstoc
					Americans are becoming more knowledgeable about diet and health issues. A 2008 study reported that grocery shoppers revealed health as a greater priority, with 68% reporting increasing concerns about their health. This study also found that 41% of shoppers were “very concerned” about the nutritional content of the foods they eat, and 47% “somewhat concerned.” In addition, 82% of shoppers hold themselves responsible for ensuring that the food they eat is nutritious (FMI, 2008). Former agriculture secretary Ann Veneman states, “The popularity of diet books and products which represent about $42 billion in annual spending in the United States shows that Americans are interested in leading healthier lives” (Ackman, 2005). Even with increasing knowledge and interest of how to control one‟s own health, there has been increasing obesity and extreme obesity amongst the general population (Figure 1). People continue to make poor choices regarding their own health decisions as it relates to not exercising, eating unhealthy foods, and drinking in excess. A common measure of obesity is from the body-mass index (BMI) and is found from taking weight/(height)2, where weight and height are in kilograms and meters respectively. Evidence in The New England Journal of Medicine (Calle et al., 1999, 2003) has found an increase in the risk of death occurring in individuals who have large BMI‟s (indicating overweight BMI>25 and obese BMI> 30) due to cancers and cardiovascular disease occurring more frequently (Figure 2). Of particular interest is the high percentage of adults who are obese in the United States. This number exceeds 30% (National Center for Health Statistics, 2008, OECD Factbook 2009). The United States also has the largest prevalence of obesity when compared to all other countries in the world (Figure 3).

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The costs to support such an obese population are quite large. In 2000, the total cost of obesity in the United States was estimated to be $117 billion with an estimated $61 billion for direct medical costs and $56 billion for indirect costs (CDC, 2008). The reason for this is that an unhealthy diet and physical inactivity contribute to and/or aggravate many chronic diseases and conditions, such as type II diabetes, hypertension, heart disease, stroke, and some cancers. The data suggests that many people are having difficulty maintaining a diet and exercise regime. Some of the reasons for this include, in 2005, only 33% of adults consumed fruit two or more times per day and only 27% consumed vegetables three or more times per day. In 2007, less than half of adults engaged in enough physical activity to provide health benefits. (CDC, 2008) The conflicting data between Americans being more health conscious, yet also more obese and likely to develop chronic diseases and conditions is very troubling. It is of crucial importance for people to understand how their actions help or hinder their ability to gain or lose weight. Their physical health and wellbeing depends on it. There must be something going on that is preventing diet and exercise programs from being effective. The standard model of economic choice says that people are rational, have unbounded resources, are driven by self interest, and seek to maximize utility. On the other hand, behavioral economics says that people are driven by social interest, have bounded resources, are emotional, and are averse to losses. It assumes that people are susceptible to temptations and often pursue immediate gratification even when they do not prefer it in the long run (a concept known as hyperbolic discounting). Other important
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behavioral economic principles include the 1) bandwadgon effect: where people are driven by social norms and what others do, 2) hot versus cold states: where people‟s decisions under „hot‟ states are much different than under „cold‟ states, 3) status quo bias: where people often are not pro-active and prefer the default, 4) relatively and choice: where offering people large quantities of different options to choose from can result in paralysis and people tend to focus on the relative value to other options, 5) mental accounting: which is an internal control mechanism to compartmentalize complex decision-making, 6) endowment effect: where people place a higher value on objects they own relative to objects they do not own, and 7) mental accounting: an internal control mechanism to compartmentalize complex decision-making (Thaler et al., 2008, Rao, 2008, Hesmat, 2008). All of the previously described behavioral economic principles can in some way be tied to people‟s choices when it comes to diet and exercise. This paper suggests insights from a behavioral economics viewpoint as to why many people fail to follow diet and exercise programs, especially over long periods of time. Behavioral economics helps to show why people fail to make decisions beneficial to their own well being. It can help show why the plan of sticking to diet and exercise was not followed. This will allow for people to better understand how to accomplish their weight goals and help prevent relapse in the future. This can help people understand what they can do to better control and manage their weight and could lead to new weight loss programs. There are also implications for possible government intervention amongst businesses to promote policies that would better help maintain healthy weight amongst the general population. Food and Diet
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There are numerous findings as it relates to food choices and consumptions from primarily a behavioral economics prospective. There are numerous factors at work relating to food choices and consumption beyond having access to nutritional information, prices of food products, and income. Self Control People have self control issues when selecting food (Just et al., 2007; Heshmat, 2006). The strength model of self control (Baumeister et al. 2007) shows that when people spend a lot of self control in dieting, they will have less self control available for other activities such as shopping, gambling, and sex. Hence, self control has been shown to be a limited mental resource. Self control is vulnerable to getting tired over time; however, it has been suggested that by drinking lemonade (which contains glucose) self control may perhaps be rejuvenated. In addition, self control can be trained, and by performing simple self control exercises self control can increase over time. Thus it is suggested that by doing such things as not swearing and standing up straight, gradually over time, more self control can become available which can allow for better self control of diet and exercise and the willpower to make the choices to best manage one‟s weight. Emotional Choice People want instant gratification now but will wait and be patient in the future. It is observed that the value of a delayed reward is discounted and reduced in value or considered to be worth less compared to the value of an immediate reward (Heshmat, 2006). If a person was asked, „which do you want right now, fruit or chocolate?‟ they would say, „chocolate.‟ but if you ask, „which do you want a week from now?‟ they would say, „fruit.‟ A more common example by Thaler, 1981, is that almost everyone
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would prefer 1 apple today rather than 2 apples tomorrow, but would prefer 2 apples in 31 days rather than 1 apple in 30 days. Thus when it comes to food decisions a person is more driven by the emotional brain than the logical one (Just et al., 2007). The emotional brain has difficulty seeing into the future where as the logical brain knows full well what will occur. A mathematical example of starting a new exercise program as described by Heshmat, 2006, can help make this concept clearer. Starting up the new exercise program will be an immediate cost of eight units of value, but will produce a delayed benefit of ten units. This results in a net gain of two units, yet it does not take into account the future value. If future events have half the value of present ones, then the ten units become five. The exercise program today results in a net loss of three units (eight minus five), and thus beginning exercise today is not something we want to do. On the other hand, if the exercise program starts tomorrow, then both the cost and the benefit are devalued by half (to four and five units, respectively). This leads to a net gain of one unit from exercising. Therefore, the new exercise program looks good tomorrow (we will want to start) but not today (we would rather do something else). The mathematical example illustrates the concept of a model known as hyperbolic discounting and how people have a strong tendency to procrastinate when it comes to such things as diet and exercise. Social Atmosphere Weight has the ability to be contagious amongst people. Many studies suggest that people eat more when in the presence of others due to social norms (Heshmat, 2006). People tend to lose track of what they are eating in social situations and let others set the
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speed and amount that is consumed. This has been shown to not be true when someone is trying to impress another person such as a job interview or when woman are on dates (Just et al., 2007; Heshmat, 2006). Instead, in these examples, the person will eat less than they would alone. Eating Environment People spend less time eating in brightly lit environments when compared to places that are more dimly lit. People tend to be less self-conscious when the lighting is dim which results in consumption of more food than normal (Just et al., 2007). Distractions such as eating while you are watching TV or on your computer can inhibit how well one monitors how much food they are consuming (USDA, 2009, Just et al., 2007). People are currently spending a significant number of minutes of time each day while they are eating or drinking and doing something else as seen in Figure 4 (USDA, 2009). Location The location of where someone decides to eat will affect what and how much is consumed. People are estimated to eat roughly 107 more calories when eating out at a restaurant instead of at home (Mancino and Kinsey, 2008). People consume more discretionary calories (solid fats, alcohol, and added sugars) when eating meals away from home (Mancino and Kinsey, 2008). Anderson and Matsa, 2009, suggest that even though people eat larger meals at restaurants than at home, they mostly offset these calories at other times of the day. Presentation of Food

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The presentation of food and distance near a person can affect their consumption. Placing candies just 3 feet away from one‟s desk, as opposed to directly on one‟s desk, can significantly reduce consumption (Just et al., 2007). Wansink, 2006, found that when people sat down to eat a bowl of Campbell‟s tomato soap and were told to eat as much as they wanted, the bowl never emptied. This was because they were not aware that the soup bowls automatically refilled themselves from a machine under the table and people did not pay attention to how much they ate. In another experiment of movie goers by Wansink, half of all people were given stale popcorn in a big bucket and the other half given stale popcorn in a medium-sized bucket. On average, it was found that people who received the big bucket ate 55% more popcorn even though it was stale. In an experiment where homes were stocked with large quantities of ready-to-eat food, the foods were consumed at greater than twice the rate of consumption in the first week than in homes given more normal amounts of food. The reason for this is due to conditioned responses (Heshmat, 2006). When people see food in visible sight, this will turn on cues based on repetitively associating seeing food and smelling it with eating (Heshmat, 2006). People tend to underestimate the effect of conditioning (Heshmat, 2006). Thus it is suggested that one distances themselves from food by perhaps going for a long walk or bike ride or engaging in other activities. Other tactics could involve placing food in certain types of packaging and in cabinets out of sight. It has been shown that simply increasing the variety of food during a meal will increase consumption, with the larger the variety, the greater the additional consumption (Rolls, 1981, Kahn and Wansink, 2004). This has been confirmed by numerous studies. For example, people presented with 10 colors versus 7 colors of M&M candies consumed
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43% more candy (Kahn and Wansink, 2004). In another experiment people were presented with an identical number and variety of colors of jelly beans. However, one group received the jelly beans sorted by color and the other group received the mixed assortment. Those who received the mixed assortment ate 69% more on average (Kahn and Wansink, 2004). In yet another study, people ate 33% more when offered sandwiches with four different fillings than when just one filling was offered (Rolls, 1981). Thus it is best to avoid a large variety of food on one‟s plate if they are attempting to diet and lose weight. A variety of foods will likely cause people to overeat. It has been suggested that once the variety becomes very large, the increase in consumption may no longer hold (Kahn and Wansink, 2004). In one study, people were invited into a store to try 6 different kinds of jam with a promise of a dollar off any jam people liked. The next weekend the same was done but with 24 different kinds of jam. More people tried the jam the weekend there were 24 varieties, but only 3% of the samplers bought any. On the other hand, the weekend there were 6 varieties of jam, 30% of the samplers made a purchase (Senior, 2006). Some differences result when the food looks, tastes, and feels very similar. In another study by Rolls, 1981, people consumed significantly more when three flavors of yogurt (hazelnut, blackcurrant, orange) which were distinctive in taste, texture and color were offered than people who were offered only one yogurt flavor. Even so when people were offered three flavors of yogurt (strawberry, raspberry, cherry) which all looked very similar in terms of texture and color and differed only in taste, there was no difference in consumption compared to people only offered one of these flavors. Experimental

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research also shows that people eat more when presented with larger packages or portions of food (Just et al., 2007). Habit Formation Habits are difficult to break, especially in the short term. It gets easier over time to break habits. When people get used to eating certain foods they will tend to continue to eat those foods. For example, some foods could be comfort foods. A person could associate positive emotional thoughts and feelings with eating certain foods even though they may be unhealthy, such as a Big Mac at McDonalds. It has been found that those who lose weight and maintain that weight for two years have a greater likelihood of keeping it off for two more years and those who maintain it for five years have an even better chance of not regaining the weight (Hesmat, 2006). Thus, it is best to not form eating habits of unhealthy foods. If you have one and can resist it, it will get easier over time to break the habit. Stress/ Emotional Eating People tend to overeat under chronic stress due to biological origins such as increased endorphin levels leading to a temporally increased mood (Hesmat, 2006, Cumella, 2006). Some people manage uncomfortable emotions, such as sadness, loneliness, grief, worthlessness, hopelessness, anger, anxiety, guilt, and shame with eating. (Cumella, 2006). Eating large amounts of food may raise blood sugar levels which can help minimize feelings of depression and loneliness (Cumella, 2006). Continuous eating over several hours or throughout the day can help distract people from disturbing thoughts (Cumella, 2006). Intense stress and eating for emotional reasons will comprise

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any long term dieting goals and cause the person to indulge in the short term. This typically results in guilt and could lead to a viscous cycle (Hesmat 2006, Cumella, 2006). Hunger Hunger triggers a negative emotional response that leads people to become impatient (Hesmat, 2006). As a person gets hungrier, their attention to healthy food diminishes and they will have less willpower to resist food. Thus the best way to guard against hunger would be to eat more meals throughout the day. The research suggests this strategy. Going 5 hours between meals instead of 4 hours adds about 52 calories for someone on a diet of2,000 calories per day. Going 6 hours between meals instead of 4 hours will increase that number of 52 calories to a 91 calorie addition (Mancino and Kinsey, 2008). With a time interval of 4 hours between meals, a person who works 40 hours a week is estimated to eat about 20% more calories than an unemployed person. With a time interval of 8 hours between meals, the full time worker is estimated to eat about 40% more calories than someone who does not work. (Mancino and Kinsey, 2008) Projection Bias People misinterpret their behavior across states. When people are in a “cold” state they are not fully aware of how “hot” states will affect their own preferences and behavior (Loewenstein, 2005). When in a “hot” state people tend to underestimate the influence of that state and will tend to overestimate the stability of their current preferences. A “cold” state could be thought of as not hungry and a “hot” state could be thought of as craving food (Hesmat, 2006). In one study by Read and van Leeuwen, 1998, some evidence towards projection bias was found. Each person in the study was asked to choose an advanced choice one
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week prior to consumption of either a healthy food or an unhealthy food. The time of the day was also a factor as some subjects would receive the snack immediately after lunch when they would be full and others around 5 in the afternoon when they would be expected to be hungry. The participants were then presented with both a healthy and unhealthy food choice a week later. Each person was asked to make an immediate selection and could change their minds from their previous choice the week prior(the testers claimed to have no knowledge of the previous choice). Of the 49% who chose a healthy snack in advance, 74% changed their mind to the unhealthy snack when they had to make an immediate choice. People who were hungry when they made the choice were more likely to select unhealthy snacks, suggesting that people were projecting their current tastes onto their future tastes. In a study by Gilbert, people were fed pretzels, peanut butter cheese crackers, tortilla chips, bread sticks, and toast, and then were asked to predict how much they would enjoy eating food the next day. One group of people (simulators) were told the next day they would eat potato chips, the other group (surrogates) were shown the report of one randomly selected participant who previously was in the study. Simulators enjoyed eating the potato chips more than their predictions due to being full when they made them, but surrogates who relied on a report of a person had much more accurate predictions of how they would feel. Both studies help show that people have difficulty accurately projecting the present onto the future. Income According to Engel‟s law, consuming energy-dense foods such as cookies and potatoes chips, is an important strategy used by low-income consumers to stretch the food
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budget (Hesmat, 2008). This is because energy dense foods are cheaper and allow for higher energy consumption (Hesmat, 2008). For example, $1.00 will buy 1,200 calories in the form of a package of cookies, but only 250 calories in the form of a bag of carrots (Hesmat, 2008). Thus, some researchers have suggested that low income households are not able to adequately purchase fruits and vegetables. In a study by Stewart and Blisard, 2008, for six out of seven selected types of food, households with an income below 130% of the poverty line spend less money than higher income households. However, when given a small increase in income, more money is allocated towards meats and frozen prepared foods, which is perhaps due to taste and convenience. The results indicate that for a household to spend more money on fruits and vegetables, a household‟s income needs to be slightly greater than 130% of the poverty line (Stewart and Blisard, 2008). The USDA has done research that suggests that in the U.S., the annual expenditure of food per person in 2006 was $1,923 for low income, $2,417 for medium income, and $3,304 for high income individuals with a corresponding percentage of total income of 21%, 11%, and 7% respectively (Figure 5). Other countries also follow similar patterns as seen in Figure 5 (USDA, 2009). Possible Policy Implications There are some policy implications that may help curb obesity in a significant way as a result of the research into behavioral economics and how it contradicts standard assumptions of economic analysis as it relates to diet and exercise Willingness to try new foods and a tendency to like them are strongly influenced by the actions of those around us. Increasing the number of tables at schools and making sure the cafeteria is brightly lit can help curb consumption. The person who delivers the
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message of healthy food and how satisfied they appear to be may have more of an impact than simple information about the virtues of healthful foods (Just et al., 2007). The Federal Trade Commission, 2008, has a detailed report on the marketing of food as it relates to children and adolescents. One important result of the report is the use of product packaging by companies to help control portion sizes. There are new 90 or 100 calorie packages of food and very small beverage containers. Policy could require individual food products targeted towards children to contain at most a certain number of calories. Policy could also require companies to not advertise towards children under 12, or if this is seen as too harsh, to require companies to devote at least a percentage (such as 50% or half) of their advertising efforts towards healthy choices or messages that incorporate healthy lifestyles. It is the author of this paper‟s view that using certain marketing techniques by delivering advertisements, brochures, and handouts of famous people to discuss healthy eating and their favorite healthy foods may be effective. This could be particularly geared towards older kids to the adolescent and teen age groups. For example, a popular Olympic athlete such as Shawn Johnson or Matt Grevers could be placed in ads and handouts while delivering a positive food message. This would be sponsored by the government and could be in conjunction with their MyPyramid program. Behavioral economic research discusses the endowment effect, where people value a good more once their property right to it has been established and the status quo bias, where people tend not to change their behavior unless the incentive to change is compelling. This loss aversion makes people more likely to choose the default option even when the cost to switch is low (Just et al., 2007). A default healthy menu option
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could be implemented at school cafeterias and kids could opt out and pay the difference of their food selection if they wanted to. Although not explicitly tested, research indicates numerous more kids would eat the healthy default option and not opt out to an unhealthy choice compared to not having a default healthy option on the menu. Knowing that people undervalue fixed costs relative to variable costs suggests that allowing people to prepay for healthful items may help to influence the intended behavior of eating healthy food(Just et al., 2007). Owen et al., 2004, found that the aesthetic nature of the local environment, the convenience of facilities for walking (footpaths, trails), accessibility of places to walk to (shops, beach), level of traffic on roads, and composites of environmental attributes have all been found to be associated with walking for particular purposes. King et al., 2003, found that living within walking distance (defined as within a 20-minute walk of home) of a park; biking or walking trail; or department, discount, or hardware store was related to higher pedometer readings in their study, and thus increased walking, in older woman. Specifically, older women who lived within walking distance of a store walked 36% more than those who did not live within walking distance (King et al., 2003) Thus it is important that policy makers understand that the environment nearby a person‟s place of work, school, and home may influence the amount of walking they do for exercise. It would therefore be good to promote the buildings of parks and trails in large residential areas as well as maintain the existing ones. Current research tends to show that adding a tax on restaurants and subsidizing health club enrollment is unlikely going to make more than a minimal decrease in overall obesity. Anderson and Matsa, 2009, make the case that public health policies targeting
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restaurants are unlikely to reduce obesity yet would negatively affect consumer welfare. They suggest that by placing a food tax on restaurant meals, obese consumers may change where they eat, but not how much they eat. Subsidizing enrollment in health clubs is likely to have only small effects on obesity rates due to the low average attendance of members (DellaVigna and Malmendier, 2005). Conclusion The results presented, were a survey of the more current literature as it relates to diet and exercise with a particular emphasis on behavioral economic issues. This paper failed to fully analyze and present a large amount of the already published information. Specifically, the exact methods used in all the studies presented were glossed over and primarily only results of studies were presented. Methods are of course very important in practice and should be fully evaluated. Results should be able to be replicated in similar yet different studies. Even so, the current literature offers numerous important implications and suggestions that consumers should understand to help alter their behavior and help curb the obesity epidemic. By altering certain elements of food products, such as decreasing the package size, modifying the shape, and decreasing the number of calories, people can consume less food. Decreasing the variety of food options such as by not purchasing mixed bags of food products and only having a few food choices on one‟s plate can help decrease food consumption. Altering the food environment by increasing the convenience of healthful foods relative to less healthful foods, reducing distractions, and making the lighting brighter may help people keep weight off (Just et al., 2007).

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When people are experiencing strong visceral influences, such as hunger or stress, their information about health and nutrition will have less impact on their actual food choices (Mancino and Kinsey, 2008). People who are less informed about health and nutrition, or consume more food prepared away from home, will be more likely to turn their back on their long run goals when faced with short-term situational factors such as hunger (Mancino and Kinsey, 2008). When people increase the time between meals or consume more of their food away from home, they are significantly more likely to consume more calories at each meal (Mancino and Kinsey, 2008). People devalue a future event and tend to place more emphasis on gratification now even if it compromises their long term weight loss goals. People do not act in their own self interests and rationally because there is a cost associated such as effort and investment. This cost will vary for people depending on their own limited willpowers (Hesmat, 2008) Certain policy implications can be implemented to better help reduce the obesity epidemic. These include insuring that companies do not aggressively target unhealthy food towards children and offer small portion and drink sizes. Additional policy could implement a default healthy option, with the ability to opt out, at cafeterias in elementary, middle, and high schools. Even so implementing these recommendations may pose significant hurdles and should be taken as possible policy that may or may not be effective towards the obesity epidemic. As such, an important area for research would be to design experiments and pilot programs to gauge the benefits, cost, potential impacts, legality, and feasibility of these possibilities. (Just et al., 2007) In summary, and in a convenient list form, the following are recommended suggestions of the findings of this paper as it relates to diet and exercise:
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    

Limit the time between meals and eat more meals throughout the day. Eat foods that are dense in nutrients such as fruit or vegetables. Limit food consumption away from home. Eat in a brightly lit environment. Limit distractions while eating and focus primarily on eating instead of doing other activities while eating.

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Eat at home when possible and preferably with others who are not overeaters. Practice self control strategies such as not swearing and standing up straight on a regular basis to increase your ability to resist unhealthy food.

    

Distance yourself from food. Place food out of sight such as in cabinets and containers. Decrease the variety of different food types on your plate (preferably two or less). Purchase food in small packages to help prevent overeating. Strongly consider receiving cognitive behavioral therapy, joining a support group, and/or seeking spiritual care if you are an emotional eater or feel as if it is beneficial to help achieve your weight goal.

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Make commitments to help prevent eating unhealthy foods such as only purchasing healthy snacks and not having any unhealthy snacks at home.

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Appendix

Figure 1: Trends in overweight, obesity, and extreme obesity from people aged 20 to 74 in the U.S.. The time scale of years is not to scale, but illustrates a rising trend of obese (BMI> 30) and extremely obese (BMI> 40) over the 56 year data set. (National Center for Health Statistics, 2008)

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Figure 2: The relative risk of death from cardiovascular disease, cancer, and all other causes among men and women who had never smoked and who had no history of disease at enrollment, compared to BMI (Calle et al., 1999). It is estimated that 90,000 deaths due to cancer could be prevented each year in the U.S. if men and women could maintain normal weight (Calle et al., 2003).

Figure 3: Country wide comparison of the percentage of the obese population aged 15 and above with data from 2006 or the latest to date available year. (OECD Factbook 2009)

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Figure 4: The average minutes/day people in the age group 18-24, 26-65, and 65+ spend eating or drinking as the main activity and eating or drinking while engaging in some other activity (USDA, 2009).

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Figure 5: Annual food expenditures per person depending on income group of low, middle, and high in both the U.S. and in other countries (USDA, 2009)

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posted:7/4/2009
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Description: Using Behavioral Economics to Bring about Diet and Food Consumption Change.