Behavioral Economics and Obesity: An Analysis of Fitness-Based Tax Incentives

  • Nicholas Wallace
Keywords: behavioral economics, fitness, tax credits, tax incentives


B oth federal and state governments have experimented with policy proposals aimed at decreasing obesity rates, mostly through the regulation of unhealthy foods. There has been little research, however, on the impact of fitness-based policy initiatives on obesity rates. To address these issues, this paper first outlines previous policies aimed at preventing obesity and provides justification in favor of government intervention. In particular, this paper argues that hyperbolic discounting, a specific type of time-inconsistent preference where individuals make decisions that favor instant gratification rather than long-term benefits, provides economic justification for government intervention to combat obesity. It then uses Canada as a case study to demonstrate the effect that fitness-based tax credits have on physical activity, obesity, and long-term healthcare costs, and highlights a current pending piece of legislation in the 114th US Congress that would bring a similar program to the United States. More research is needed to confirm the effectiveness of fitness tax incentives on increasing physical activity among currently sedentary individuals. Nonetheless, this paper concludes by suggesting that fitness-based tax incentives are more politically viable than food regulations.

Author Biography

Nicholas Wallace
NICHOLAS WALLACE is a second-year Master’s of Public Policy candidate, concentrating in health policy. A fitness enthusiast, Nick is an ACSM Certified Personal Trainer and served as the Personal Training Supervisor at the Lerner Health and Wellness Center during his tenure at GW. Fitness was the catalyst to his interest in public health, and he’s interested in which policy tools can be utilized to promote health, prevent disease, and combat obesity. Nick previously worked as an intern with both the President’s Council on Fitness, Sport, and Nutrition and Trust for America’s Health (TFAH). He currently works as a Health Policy Intern with the Senate Committee on Health, Education, Labor, and Pensions (HELP). Born and raised on Long Island, Nick previously earned a bachelor’s degree in Political Science/History from Providence College. An avid golfer/triathlete and karaoke superstar, Nick is a lover of all things fitness and politics and looks forward continuing his journey of health promotion here in D.C. in the future.