Food Calorie Intake under Grain Price Uncertainty: Evidence from Rural Nepal

This study evaluates the effects of grain output price uncertainty on the farm income of rural households and, consequently, how this uncertainty influences caloric intake through changes in farm income. Using a rural household data set, augmented with output price uncertainty measures calculated from historical time-series data, we find that grain output price uncertainty tends to decrease crop production income of rural households. In addition, we find that higher crop income from production increases calorie intake of rural households. Taken together, these results suggests that output price uncertainty during the production process may tend to reduce caloric intake of rural Nepalese households since the price uncertainty negatively affects the crop income households need to buy calorie-rich staple foods.