Worth Your Weight: Experimental Evidence on the Benefits of Obesity in Low-Income Countries

I study the economic value of obesity-a status symbol in poor countries associated with raised health risks. Randomizing decision-makers in Kampala, Uganda to view weight-manipulated portraits, I find that obesity is perceived as a reliable signal of wealth but not of beauty or health. Thus, leveraging a real-stakes experi-ment involving professional loan officers, I show that being obese facilitates access to credit. The large obesity premium, compara-ble to raising borrower self-reported earnings by over 60 percent, is driven by asymmetric information and drops significantly when providing more financial information. Notably, obesity benefits and wealth-signaling value are commonly overestimated, suggesting market distortions. (JEL D82, G21, G51, I12, O16, Z13)

Automated summary

This study examines the economic value of obesity, finding that in poor countries, obesity is perceived as a signal of wealth but not beauty or health. The study also shows that being obese facilitates access to credit, but the obesity premium is commonly overestimated, suggesting market distortions.