Overweight and obesity are growing health problems in many developing countries. Rising obesity
rates are the result of changes in people’s diets and lifestyles. Income growth and urbanization are
factors that contribute to these changes. Modernizing food retail environments may also play a
certain role. For instance, the rapid spread of supermarkets in many developing countries could
affect consumer food choices and thus nutritional outcomes. However, concrete evidence about
the effects of supermarkets on consumer diets and nutrition is thin. A few existing studies have
analyzed related linkages with cross-sectional survey data. We add to this literature by using panel
data from households and individuals in urban Kenya. Employing panel regression models with
individual fixed effects and controlling for other factors we show that shopping in supermarkets
significantly increases body mass index (BMI). We also analyze impact pathways. Shopping in
supermarkets contributes to higher consumption of processed and highly processed foods and
lower consumption of unprocessed foods. These results confirm that the retail environment affects
people’s food choices and nutrition. However, the effects depend on the types of foods offered.
Rather than thwarting modernization in the retail sector, policies that incentivize the sale of more
healthy foods – such as fruits and vegetables – in supermarkets may be more promising to promote
desirable nutritional outcomes.