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Effectiveness of Food Subsidies in Raising Healthy Food Consumption: Public Distribution of Pulses in India

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  • Chakrabarti, Suman
  • Avinash, Kishore
  • Devesh, Roy

Abstract

Abstract There is an increasing demand to add pulses to the basket of subsidized goods in the public distribution system (PDS) of India—the world’s largest food-based social safety-net program. Would subsidizing pulses through PDS lead to a significant increase in its consumption? We study the case of subsidy on pulses in select Indian states and its impact on consumption and ultimately nutrition (in terms of protein intake) by exploiting an exogenous variation in prices to answer this question. Between 2004–2005 and 2009/2010, four Indian states introduced subsidized pulses through the country’s food-based social safety-net program, the Public Distribution System (PDS), while other states did not. We exploit exogenous price variations to examine whether the price subsidy on pulses achieves its goal of increasing pulse consumption, and by extension protein intake, among India’s poor. Using several rounds of consumption expenditure survey data and difference-in-difference estimation, we find that the change in consumption of pulses due to the PDS subsidy, though statistically significant, is of a small order, and not large enough to meet the goal of enhancing the nutrition of beneficiaries.

Suggested Citation

  • Chakrabarti, Suman & Avinash, Kishore & Devesh, Roy, 2016. "Effectiveness of Food Subsidies in Raising Healthy Food Consumption: Public Distribution of Pulses in India," 2016 Annual Meeting, July 31-August 2, 2016, Boston, Massachusetts 235649, Agricultural and Applied Economics Association.
  • Handle: RePEc:ags:aaea16:235649
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    References listed on IDEAS

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    1. Kishore, Avinash & Chakrabarti, Suman, 2015. "Is more inclusive more effective? The ‘New Style’ public distribution system in India," Food Policy, Elsevier, vol. 55(C), pages 117-130.
    2. Jha, Raghbendra & Gaiha, Raghav & Pandey, Manoj K. & Kaicker, Nidhi, 2013. "Food subsidy, income transfer and the poor: A comparative analysis of the public distribution system in India's states," Journal of Policy Modeling, Elsevier, vol. 35(6), pages 887-908.
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    5. Kishore, Avinash & Chakrabarti, Suman, 2015. "Is more inclusive more effective? The “new-style†public distribution system in India:," IFPRI discussion papers 1421, International Food Policy Research Institute (IFPRI).
    6. Tarozzi, Alessandro, 2005. "The Indian Public Distribution System as provider of food security: Evidence from child nutrition in Andhra Pradesh," European Economic Review, Elsevier, vol. 49(5), pages 1305-1330, July.
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    Cited by:

    1. Joshi, Pramod Kumar & Kishore, Avinash & Roy, Devesh, 2016. "Making pulses affordable again: Policy options from the farm to retail in India:," IFPRI discussion papers 1555, International Food Policy Research Institute (IFPRI).
    2. Susan Godlonton & Manuel A Hernandez & Mike Murphy, 2018. "Anchoring Bias in Recall Data: Evidence from Central America," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 100(2), pages 479-501.

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    Keywords

    Agricultural and Food Policy; Consumer/Household Economics; Food Security and Poverty; International Development;

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