Information, endogeneity, and consumer health behaviour: application to dietary intakes

Due to heightened public health interest, a growing number of consumer heal th behaviour studies are focusing on the effect of health information on th e demand for health inputs and outcomes. Many of these studies, however, ha ve overlooked the potential endogeneity of information variables stemming f rom unobserved individual heterogeneity. Due to simultaneity bias, ignoring endogeneity may lead to inaccurate estimates of informational effects on h ealth behaviour. Using dietary intake data for fat, saturated fat, choleste rol, and fibre, this paper illustrates the pitfalls of treating health info rmation related to these nutrients as exogenous variables in their demand e quations. In most of the estimated models, the exogeneity of information is statistically rejected. When the information variables are treated as exog enous variables, their effects on dietary intakes are underestimated. The e stimated effects of key intake determinants such as income, education, ethn icity, and race are also different in such a specification compared to a sp ecification which treats information variables as endogenous. Implications for nutrition education policies are discussed.