Childhood overweight and obesity, caused by a positive energy balance where energy intake exceeds energy expenditure, is a concern in many countries. Recent overviews have suggested a range of specific energy balance related behaviours (EBRB) that may contribute to an increased risk for excessive weight gain
], including high intake of sugared beverages, sedentary behaviour and lacking physical activity. Such behaviours have been attributed to the so-called obesogenic environment
], where palatable high-energy foods are increasingly available, accessible and affordable relative to less energy-dense foods and beverages, while most physical activities are avoidable and no longer necessary.
A large number of studies concerning environmental correlates, determinants and interventions that may contribute to promoting healthy eating and physical activity have been reviewed in several review studies and meta-analyses. Some of these studies address the population in general,
], whereas others address children and adolescents in particular
], pointing at various factors of importance in the home and school environment.
The obesogenic environment has been dissected in physical, socio-cultural, political and economic environments within e.g. the ANGELO framework
]. Most research to date has been focussed on physical and socio-cultural environments (reviewed by e.g. Ferreira et al.
]; Huybrechts et al.
], and Giskes et al.,
]). The reviews indicate that one of the strongest correlates of different EBRB is socio-economic position, most often represented by level of education or income. The available reviews additionally show that other, more micro-level economic factors – such as financial incentives or constraints regarding EBRB – have hardly been studied, especially where children’s EBRB is concerned, although economic factors and incentives have been suggested to be important in the context of the obesogenic environment and as tools to promote healthier eating
]. A recent review specifically focussing on such incentives concluded that such economic factors may be promising in promoting healthy EBRB in children
]. More specifically, economic motives, in terms of relative prices of energy-dense versus less energy-dense foods as well as the relation between food prices and incomes, are likely to affect the demand for foods and beverages
]. Economic motives may also underlie the availability of foods and beverages offered to schoolchildren
According to neoclassical micro-economic theory
], rational individuals are assumed to strive at maximizing their utility (i.e. their level of needs’ satisfaction in a broad sense, including nutritional and other material needs, pleasure, convenience, etc.) within the limits given by a budgetary constraint. Within the neoclassical economic framework, we may assume that parents’ utility depends positively on their children’s current perceived utility and on the children’s future health prospects
], and that children’s current utility, as well as their future health prospects, depend on their current consumption of sugar-sweetened drinks (soft drinks and fruit juices) and their sports activities. Within this framework, parents face a trade-off between satisfying their children’s current preferences versus their long-term health prospects, and current choices of e.g. sports activities and soft drink consumption reflect this trade-off. A number of factors may influence these trade-offs, such as budget size, with a tight budget leading to higher priority given to perceived necessities, because such necessities are perceived relatively more valuable, when the budget tightens.
The outlined micro-economic line of thinking might be considered as an element in more general social-ecological conceptual models
]. But the economic approach could also be interpreted as a more comprehensive model on its own, with some social and cultural factors contributing to the formation of preferences, and other social factors along with availability and physical structures forming some of the framework within which individuals maximize their utility. The literature on behavioural psychology provides useful insights into some of the key mechanisms in individuals’ health behaviour that should be taken into account when extending the economic model framework in this direction, such as the Theory of Planned Behaviour
] or the Health Belief Model
], which describe health related decisions as dependent on individuals’ perception of health risk, motivation and potential barriers (including e.g. lack of self-efficacy).
If parents provide their children with money that are ‘ear-marked’ for supporting certain purposes, e.g. sports activities, the child’s perceived trade-off would tend to be more in favour of the supported activity, thus providing an economic incentive to participate in this activity.
Many parents provide their children with ‘pocket money’, which they can spend without being controlled or monitored by the parents. As children are not presumed to give high priority to their own long-term health prospects, compared with most parents’ priorities, this separation of the household budget may lead to an in-optimally high total child consumption of soft drinks, from a health promotion point of view. This occurs because the children allocate a relatively large share of their pocket money to these drinks (because they to a lesser extent prioritize future health considerations), and as parents cannot perfectly monitor these purchases, their own trade-off between children’s current preferences and long-run health does not take full account of this
A change in the price relation between, for example, soft drinks versus other foods or beverages (for instance a partial increase in the price of these soft drinks) implies that the rational individual will re-allocate money from soft drink consumption to other goods. If the household budget is split into children’s ‘pocket money’ and ‘rest’, the child will respond to a price change within the trade-off between alternative pocket money spending opportunities, whereas parents respond within the framework of a reduced real household budget, taking (imprecisely) into account that the children cover some soft drink consumption with their own money.
A tighter children’s budget – in terms of fewer pocket money – may tend to make children’s own soft drink purchases more price sensitive on the one hand, because the money scarcity will increase the perceived value of this money for other purposes (opportunity cost). On the other hand, less pocket money may imply a low initial consumption and hence less potential for changes in consumption implying a lower price sensitivity. Similarly, if children spend a large share of their pocket money on soft drinks, this may imply relatively lower price responsiveness on these drinks due to lower perceived opportunity costs, but on the other hand, the high consumption implies a relatively larger room for change, leaving the net effect on price responsiveness an empirical question. Similar mechanisms related to changes in budget apply to the price sensitivity in parents’ soft drink demand, but as soft drinks normally constitute a relatively small share of parents’ household budget, the opportunity cost effect of a soft drink price change is considered to be moderate. The higher priority that parents give to their children’s currently perceived utility, compared with long-run health prospects, the less responsive will the parents’ purchases be to a soft drink price increase. Hence, in a setting where children get their own pocket money, the main effect of a price increase on soft drinks is expected to occur in the children’s own purchases.
The objective of the present paper is to explore the association between economic factors and incentives and different EBRB (sports activity and intake of soft drinks and fruit juice) in 10-12
year-old school children in seven European countries: Belgium, Greece, Hungary, Netherlands, Norway, Slovenia and Spain. Furthermore, we aimed to investigate the extent of price sensitivity in children’s soft drink consumption and the role of economic factors in determining this price responsiveness.
The above neoclassical economic framework suggests that the economic environment may influence children’s EBRB via two mechanisms: either via the relative prices/costs of alternative choices, or via the size of the budget at the decision maker’s disposal. Parents are generally presumed to make decisions that can be influenced by economic incentive mechanisms, but in many cases, parents delegate parts of these decisions to the children, either by offering earmarked funds for specific purposes, e.g. sports, or by providing pocket money for the children to spend on minor items at their own choice. Such delegation of decisions introduces two levels of decision making: the parent level and the child level. Based on this theoretical framework, we derived the following research hypotheses regarding children’s sports activities and soft drink consumption:
1. Children’s sports activity is negatively associated with a tight household budget, because such sports activities may not be perceived as a necessity.
2. Children’s time spent on sport activities is positively associated with parents’ subsidization of these activities - subsidization makes sports participation less costly from the child’s perspective.
3. Children’s consumption of soft drinks and fruit juice is negatively associated with a perceived tight household budget - because such drinks may not be considered as necessities.
4. Children’s consumption of soft drinks and fruit juice is positively associated with allocating pocket money to the children - because the children’s trade-offs tend to favourize short-term pleasure and consumption.
5. Children’s price responsiveness regarding soft drink purchases is correlated with the amount of pocket money – but the direction of this correlation depends on the balance between ‘opportunity cost effect’ and ‘room for change effect’.
6. The share of the children’s pocket money that is currently spent on soft drinks is correlated with demand’s price responsiveness - if marginal utility is assumed to be a decreasing function of the quantity of soft drink consumed (and similarly for other pocket money spendings) the substitution effect will tend to be stronger, if soft drinks constitute a large share of the children’s pocket money.
Hypotheses 1-4 primarily address the role of budgetary restraints - from the household and from the child perspective - on children’s EBRB, as measured by sports activity and consumption of soft drinks and fruit juices. Hypotheses 5-6 relate to the role of price incentives, using the stated price responsiveness of soft drink consumption as a marker, because soft drinks tend to be one of the commodities that many children most often buy with their own pocket money. These research hypotheses will be investigated in the empirical work below.