Obesity and compensatory consumption: Evidence from jewelry shopping

This article examines the link between obesity and compensatory consumption in the context of jewelry shopping. Study 1 finds that participants with higher body mass indices are willing to pay more for a jewelry item. Study 2 generalizes this finding by documenting that jewelry store sales are higher in places with greater obesity rates. Using Google Trends data, Study 3 shows that the search interest for jewelry stores increases with the obesity rate and that this relationship is mediated by people's dissatisfaction with their current weight as revealed by their search activity. Finally, supporting the self-discrepancy account, Study 4 shows that the use of self-related and discrepancy words together in jewelry-related tweets is more pronounced in places with greater obesity rates. These findings collectively help enhance the field's understanding of the consumption behavior of people who are part of a large stigmatized group.     

How do low-income enrollees in the Affordable Care Act marketplaces respond to cost-sharing?

The Affordable Care Act requires insurers to offer cost-sharing reductions (CSRs) to low-income consumers on the marketplaces. We link 2013–2015 All-Payer Claims Data to 2004–2013 administrative hospital discharge data from Utah and exploit policy-driven differences in the actuarial value of CSR plans that are solely determined by income. This allows us to examine the effect of cost-sharing on medical spending among low-income individuals. We find that enrollees facing lower levels of cost-sharing have higher levels of healthcare spending, controlling for past healthcare use. We estimate demand elasticities of total health care spending among this low-income population of approximately −0.12, suggesting that demand-side price mechanisms in health insurance design work similarly for low-income and higher-income individuals. We also find that cost-sharing subsidies substantially lower out-of-pocket medical care spending, showing that the CSR program is a key mechanism for making health care affordable to low-income individuals.