Tuesday, January 4, 2011

Correlation Means Confusion

Very interesting set of figures on food prices and health problems:

 The obvious conclusion to draw is that cheap food causes obesity, diabetes, and heart disease.  This makes sense, but the comparative statics here may be the product of something else.  It could be that the US health care system is responsible for all but the first figure, and so the correlation might be spurious.  It would be interesting to see what the figures look like over time and whether correlations change over time, as that might help us figure out how much of this is new and which way the causal arrows are going.  My guess is that the institutions that have led to more equality and better health come are independent of the price of food.  I'd also like to see where Canada fits in, as the food here is more expensive in the US, but perhaps not as much as in Europe. 

The interesting implication here is that ethanol, by driving up the prices of corn and corn-based products (that would corn syrup that is in heaps of processed food), would actually be improving American health in the long run.

But the author of this stuff has another axe to grind, suggesting that cheap food facilitates or is perhaps even caused by income inequality--that the American system of inequality works by providing underpaid working folks with cheap food.
To me, cheap food underpins our highly inequitable income system. If we're going to have a large low-income class, a perpetually squeezed middle class, and a small caste of super-rich, then a cheap food system plays a vital role in keeping those at the bottom fed -- if under-nourished.
Interesting conclusion, but it is not clear that raising food prices would create the revolution that this guy apparently seeks.  Going back to the top, I guess I would want to distinguish between cheap good food and cheap bad food.  Is it that Americans have lots of cheap broccoli?  Or lots of cheap potato chips?  I have not read all of the books and articles that address the food industry's manipulation of our taste buds, so I cannot say much about what is going on here.  I can raise two questions: why is food so expensive in Europe and why is it tolerated?

HT to Brian Sala for the FB link.

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