The Economics of Thinness (Ozempic Edition)

As some describe it, this is where the world is going now thanks to the discovery of weight loss drugs. In the three short years since the US Federal Drug Administration approved these drugs, their use has increased exploded. Novo Nordisk, maker of Ozempic and Wegovy, has become Europe’s most valuable company. Eli Lilly, producer of Mounjaro, was one of America’s top-performing producers last year. And celebrities like Oprah Winfrey and Kelly Clarkson have emerged, slimmed down and trim, almost overnight.

Morgan Stanley, a bank, estimates that as many as 9% of Americans will adopt brand-name versions weight loss medications by 2035. That’s just the tip of the iceberg. The demand for versions of these drugs is only growing. On the New York subway, Ro, a healthcare startup, is advising travelers to “skip the shortages” and access cheaper versions for as little as $99 a month. Instagram is full of advertisements from companies like hers en eden, which target young people by using small brand names and soothing color schemes. In September, Kourtney Kardashian, a socialite, started selling a capsule through lemme, her supplement company, which also sells vaginal probiotic gummies and anti-cellulite pills.

The most important consequence of the discovery of the drugs is clear: they will improve the health and lives of most people who have access to them. But the understandable joy about the health benefits has been tempered in some quarters by fears that the drugs will encourage society’s worst aesthetic impulses: that they will create an even stronger expectation that everyone should conform to contemporary beauty standards, a trend that may bring its own health burden in the form of mental health issues and eating disorders.

People clamor for weight loss drugs for aesthetic reasons, but also because of health concerns. This is not mere vanity. There is widespread evidence of discrimination against fat people. In Sweden and Mexico, where including a photo with a resume is common, researchers manipulated images to make identical fictional applicants appear fatter or more obese. They found that they were significantly less likely to get interviews. Petter Lundborg of Lund University and John Cawley of Cornell University compared the wages of thin and fat women, adjusted for education, experience and other factors, in Europe and America respectively, and found that women with obese BMI earn about 10% less than their peers. peers. The implication of this is stark: For an obese woman earning, say, $80,000, the impact of reaching Ozempic could be more economically consequential than any savings she might make on her health care bills.

Will weight-loss drugs worsen discrimination? Tressie McMillan Cottom, a New York Times columnist, has spoken out against the idea that Ozempic will cure “the moral crisis of fat bodies that refuse to get and stay thin.” The drug’s implicit promise is that “it can fix what our culture has broken.” (Her preferred solution: Instead of solving obesity with drugs, society should simply stop stigmatizing fat people.) “Ozempic has won, body positivity has lost. And I want no part of it,” Rachel Pick, a writer, complained in the Guardian.

Such concerns are fueled by the fact that the body positive movement, which pushes back on the idea that everyone should strive to achieve the same body ideal, is gaining ground. Retailers are offering more and more sizes. It has become common to see clothes on display. on larger women when shopping online. John Galliano of Maison Margiela, a luxury fashion house, used models of all sizes at a show in Paris.

It is logical to think that in the short term, prejudices against fat people could be reinforced by weight-loss drugs. Until now they have mainly been available to the wealthy, Mr Cawley notes: “If the ability to lose weight is something that is strongly linked to a person’s income, there is a risk that being obese could be seen as a sign that you have a lower income.” But mass adoption is happening – and it will change things.

The signal and the scale

Early humans were the first to invent tools. Then he invented jewelry. Archaeologists have discovered sets of shells, believed to be necklaces or earrings, dating back 150,000 years – older than the development of language. The urge to use your appearance to indicate how you stand out from others is one of humanity’s oldest impulses.

People have sent different signals over time and across cultures. Sometimes the impetus for change is the discovery of a newer, shinier material: snail shells were replaced by gold beads and later by diamonds. The high-status beauties of the Renaissance were the voluptuous ladies painted by Rubens. Then the Industrial Revolution made food more affordable for the masses and a slimmer appearance became more desirable. If Malthus – who predicted in 1798 that the population would soon be endangered by food shortages – had been right, fatness would certainly still be in fashion.

Weight loss drugs will likely be responsible for the next big change, and it won’t be the onset of Stepford dystopia. Thinness is now desirable because it sends a message: that you have the time to exercise, the money to buy healthy food, and the education to know what diet to follow. In low-income countries like Malawi and Uganda, where food is scarce for poorer people, obesity is more desirable, as in the pre-industrial West. A study by Elisa Macchi of Brown University conducted in these countries manipulated images attached to loan applications and found that applicants who appeared obese had better access to credit.

The economics of signaling were best articulated by Michael Spence, a Nobel laureate. In 1973, Mr. Spence developed a simple model of how the labor market works. There are two types of applicants: good, high-productivity candidates and bad, lazy candidates. Potential employers don’t know which is which. Applicants can obtain a degree, but this is difficult; Bad candidates are unlikely to be able to do this. Getting a degree is also expensive for the good ones; it costs time and money. In this model, even if there are no real benefits to education, good candidates will acquire a degree as a signaling tool to let employers know they are strong candidates.

Before Mr. Spence’s article, the thinking was that employers valued education because it improved productivity. Mr. Spence showed that there might be more to it. Would you rather have gone to Harvard – studied, taken classes, made connections – and never been able to reveal it? Or would you rather have a piece of paper stating that you have been? A similar question concerns the truth about body types. Would you rather look slim and in shape? Or would you actually want to be healthy?

With their appearance, people send signals that have value on the labor market and on the marriage market. But what if someone didn’t have to be rich or disciplined to be thin? A signal is only useful if it conveys the right message. In Mr. Spence’s model, the signal only works if a college degree is difficult to obtain and can only be obtained by strong candidates.

To see how quickly the value of a signal can be lost, consider another example. When email was new, it was clear that if someone addressed you by name in the subject line or text, a real person was trying to get your attention. After all, they had created a message just for you. Then it became possible for senders to check a long list of people by name with ease. For a while, email users were fooled: they clicked, expecting an important message, and got a generic advertisement instead. Yet they learned quickly.

In the gossip corners of the internet, a transformation in the perception of thin people is already underway. Posters on the subreddit ‘nyc influencer snark’, a forum dedicated to tackling the bad taste of D-List TikTok stars and Instagram influencers, are accusing everyone of being hot-buttoned. Often this is idle talk, but sometimes they provide evidence (or “receipts”). Two months ago, “Nycundercover,” a usual poster, published a screenshot of Serena Kerrigan, who has 217,000 Instagram followers, standing in front of her refrigerator. “Not that any proof was needed, but she can’t even be bothered to hide her Ozempic now,” they wrote above an image with a red arrow pointing to the tell-tale cap of a GLP-1 pen.

Because the medication must be kept cold to be effective, kitchen shots and bruises on the abdomen (the typical injection site) have become the way internet sleuths figure out who is taking the drugs. It may come as no surprise that these posters are not emphasizing this to be nice or to flatter users of the drugs because of their new figures. It’s a gotcha moment. In economic jargon, they reveal that the signal the person sends with his body is false. They didn’t get thin the hard way.

Ozempic is not going to repair society and rid it of status games. Signaling that you are unique or better than others is deeply ingrained in human nature. However, the idea that it could become easy to be thin suggests that thinness will lose some of its hold on the popular psyche. No doubt something else will take its place. Maybe it will be a fixation on muscles, which are harder to fake. Or perhaps the truly elite will be the ones who signal that they are above all else after all, by doing so with softer, mediocre body types.

In many ways this can be a blessing. The pursuit of slimness, especially for young girls, has come at a high cost. Contrary to what many seem to think, by making it easy for almost anyone to be thin, Ozempic could solve not only America’s weight problem, but America’s weight problem as well.