Might Universal Basic Income Reduce Obesity?

Might Universal Basic Income Reduce Obesity?

Universal basic income is generating some buzz in this election cycle. Presidential candidate Andrew Yang is pushing this idea of a guaranteed income for every adult. No strings attached. But Alaska already has it. Since 1983, the state’s Permanent Fund Dividend has provided an annual, unconditional, and universal income to Alaskans. What’s more, economists are telling us that it might serve to lower a child’s risk of obesity. Brett Watson, Mouhcine Guettabi, and Matthew Reimer published their analysis last week on SSRN.

A Model from Data on Alaska’s Children and Families

These researchers crunched a lot of data from diverse datasets on Alaska’s families and children. They also used administrative data from the Permanent Fund. From all this data they built an empirical model to estimate the probability of a child having obesity at age three.

At the end of all this analysis, they linked a thousand dollars in Permanent Fund payments to a 4.5 percent reduction in a child’s risk of obesity. Furthermore, they estimate that that reduction could prevent 500 cases of obesity and save medical costs of two to five million dollars annually. One of the researchers, Dr. Guettabi, expressed surprise at what he found:

The magnitude of our findings was certainly surprising. Though the UBI is not implemented with the intent of reducing childhood obesity, it appears that these unconditional cash transfers have wide-ranging effects, and this is one of them.

Biggest Impact on Middle Income Families

This risk reduction showed up only in middle income families. Researchers saw no evidence of an effect in either poor or wealthy families. But in middle income families, the reduction was clear. Looking for explanations, these researchers saw different behaviors among women in middle income families. After receiving payments, the women with younger children worked less and spent more time with their children.

Of course, since all of this is observational, we can only speculate about cause and effect. But the potential for a reduction in childhood obesity gives us a lot to think about. With sufficient curiosity, it might lead us to some better strategies for prevention.

Click here for the research paper and here for further reporting on it.

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June 2, 2019

One Response to “Might Universal Basic Income Reduce Obesity?”

June 04, 2019 at 8:20 am, Mary-jo said:

The big take-away, for me, from this study, is that the researchers found the effect in the middle-class was because the mothers spent more time with their children. I’m thinking, then, perhaps this led to less ‘latchkey kid’ calorific food intake, less sedentary activity such as TV watching and gaming, less emotional eating or mindless eating out of boredom, better sleep habits. Or was the risk reduction associated with less stress — in the parents, the children, the family? If the mother’s in the poor and wealthy groups spent more time with their children, regardless of not working, would the effects be the same as in the middle-class. Lots of questions. 😁