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Reforming food subsidy scheme: Estimating the gains from self-targetting in India

Author

Listed:
  • Bhaskar Dutta

    (Indian Statistical Institute, New Delhi)

  • Bharat Ramaswami

    (Indian Statistical Institute, New Delhi)

Abstract

This paper uses the theoretical framework of the theory of tax reform to analyse whether a "small" change in an existing food subsidy program can be welfare-improving and revenue-neutral. It shows how existing econometric methods can be adapted to estimate demand parameters even when household level data exhibit little price variation because the government controls food prices. The methodology developed here is used to estimate welfare changes from shifting a rupee of subsidy on existing commodities to coarse cereals in the Indian public distribution system.

Suggested Citation

  • Bhaskar Dutta & Bharat Ramaswami, 2002. "Reforming food subsidy scheme: Estimating the gains from self-targetting in India," Discussion Papers 02-09, Indian Statistical Institute, Delhi.
    • Handle: RePEc:alo:isipdp:02-09
    as

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    File URL: http://www.isid.ac.in/~pu/dispapers/dp02-09.pdf
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    References listed on IDEAS

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    1. Giovanni Andrea Cornia & Frances Stewart, 1993. "Two errors of targeting," Journal of International Development, John Wiley & Sons, Ltd., vol. 5(5), pages 459-496, September.
      • Giovanni Andrea Cornia & Frances Stewart, 1993. "Two Errors of Targeting," Papers iopeps93/54, Innocenti Occasional Papers, Economic Policy Series.
    2. Alderman, Harold & Lindert, Kathy, 1998. "The Potential and Limitations of Self-Targeted Food Subsidies," The World Bank Research Observer, World Bank, vol. 13(2), pages 213-229, August.
    3. Atkinson, Anthony B., 1970. "On the measurement of inequality," Journal of Economic Theory, Elsevier, vol. 2(3), pages 244-263, September.
    4. Ahluwalia, Deepak, 1993. "Public distribution of food in India : Coverage, targeting and leakages," Food Policy, Elsevier, vol. 18(1), pages 33-54, February.
    5. Deaton,Angus & Muellbauer,John, 1980. "Economics and Consumer Behavior," Cambridge Books, Cambridge University Press, number 9780521296762.
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    Citations

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    Cited by:

    1. Achintya Ray, 2006. "A Class of Decomposable Poverty Measures With Public Transfers," Economics Bulletin, AccessEcon, vol. 9(3), pages 1-8.
    2. Hamidreza Izadi & Mojtaba Mohammadnejadi Moodi & Morteza Sayareh, 2023. "Investigating the role of ranking household expenditures to reform the subsidies payment system as an economic policy for Iran," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 28(1), pages 177-186, January.
    3. Neha Gupta, 2013. "Government Intervention In Grain Markets In India--Rethinking The Procurement Policy," Working papers 231, Centre for Development Economics, Delhi School of Economics.
    4. Andaleeb Rahman, 2014. "Revival of rural PDS: Expansion and outreach," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2014-012, Indira Gandhi Institute of Development Research, Mumbai, India.
    5. Karami, Ayatollah & Esmaeili, Abdoulkarim & Najafi, Bahadin, 2012. "Assessing effects of alternative food subsidy reform in Iran," Journal of Policy Modeling, Elsevier, vol. 34(5), pages 788-799.
    6. Anders Kjelsrud & Rohini Somanathan, 2017. "Poverty Targeting Through Public Goods," Working Papers id:11643, eSocialSciences.
    7. Gharibnavaz, Mohammad Reza & Waschik, Robert, 2015. "Food and energy subsidy reforms in Iran: A general equilibrium analysis," Journal of Policy Modeling, Elsevier, vol. 37(5), pages 726-741.
    8. Andaleeb Rahman, 2014. "Revival of Rural PDS: Expansion and Outreach," Working Papers id:5796, eSocialSciences.
    9. repec:ebl:ecbull:v:9:y:2006:i:3:p:1-8 is not listed on IDEAS

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    More about this item

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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