Obesity in America: A Market Failure?

• Author: Thomas A. Hemphill
• DOI: http://doi.org/10.1111/basr.12157
• Published date: 01 December 2018
• Date: 01 December 2018

Business and Society Review 123:4 619–630

© 2018 W. Michael Hoffman Center for Busi ness Ethics at Bentley Uni versity. Published by

Wiley Period icals, Inc., 350 Main St reet, Malden, MA 02148, USA, and 9 600 Garsington

Road, Oxford OX4 2DQ, U K. DOI: 10.1111/basr.12157

Obesity in America: A Market

Fa ilure?

THOMAS A. HEMPHILL

ABSTR ACT

Since the late 1980s, obesity in Americ a has been a loom-

ing public health concern. Recently, medical resea rchers

found that, for the 2011-12 period, 35.3 percent of U.S.

adults (aged 20 or older), 20.5 percent of teenagers (ages

12-19), 17.7 percent of children (ages 6-11), and 8.4 per-

cent of young children (ages 2-5) have obesity, and 6.3

percent of U.S. adults having severe obesity. In a recent

working paper by Ka rnani, McFerran, and Muk hopadhyay

(2015), these management scholars arg ue that obesity

represents a market failure. In thei r study, Karnani et al.

evaluate the effectiveness of corporate social responsibil-

ity, industry self-regulation, social activ ism, and govern-

ment regulation as to its effectiveness on consumer

behavior and reducing obesity. Karna ni et al. are advo-

cates of “reasonable” government intervention, i.e., tax/

subsidies, market regulation, and education, to address

the public health issue of obesity. However, evidence

shows that reasonable government intervention is a lso

vulnerable to government fai lure and potential public

health risk. Recommended is a m ix of institutional

Thomas A. Hemph ill is David M. French Dist inguished Professor of St rategy, Innovation and

Public Policy, School of M anagement, Uni versity of Mich igan-Fli nt. E-mail: t homashe@um-

fli nt.edu.