How Consumer Price Subsidies affect Nutrition
We study the effect on nutrition of an exogenous increase in food grain subsidy in rural India resulting from a program targeting the poor. Our analysis suggests that increase in income resulting from the food price subsidy changed consumption patterns in favor of the subsidized grains and certain more expensive sources of calorie, and lowered consumption of coarse grains that are cheaper, yet taste-wise, inferior sources of nutrition, but had no effect on calorie, protein and fat intake in poor households. Further, our analysis shows that households allocated some of the increase in income from food price subsidy to expenditures on non-food items. Estimates of the price effect of food price subsidy on the three measures of nutrition are also negligible. We find evidence that the decline in the price of wheat and rice, changed consumption patterns toward increased consumption of wheat and rice and lower consumption of coarse grains, the unsubsidized staple food. Our analysis thus suggests that food price subsidies are likely to affect agriculture markets without impacting nutrition.
|Date of creation:||Sep 2013|
|Publication status:||published as World Development Volume 74, October 2015, Pages 25–42 Cover image How Consumer Price Subsidies affect Nutrition Neeraj Kaushala, Felix M. Muchombab|
|Note:||DEV HE PE|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Kochar, Anjini, 2005. "Can Targeted Food Programs Improve Nutrition? An Empirical Analysis of India's Public Distribution System," Economic Development and Cultural Change, University of Chicago Press, vol. 54(1), pages 203-235, October.
- James W. Hardin, 2002. "The robust variance estimator for two-stage models," Stata Journal, StataCorp LP, vol. 2(3), pages 253-266, August.
- Subramanian, Shankar & Deaton, Angus, 1996.
"The Demand for Food and Calories,"
Journal of Political Economy,
University of Chicago Press, vol. 104(1), pages 133-162, February.
- Subramanian, S. & Deaton, A., 1994. "The Demand for Food and Calories," Papers 175, Princeton, Woodrow Wilson School - Development Studies.
- Douglas Staiger & James H. Stock, 1997. "Instrumental Variables Regression with Weak Instruments," Econometrica, Econometric Society, vol. 65(3), pages 557-586, May.
- Douglas Staiger & James H. Stock, 1994. "Instrumental Variables Regression with Weak Instruments," NBER Technical Working Papers 0151, National Bureau of Economic Research, Inc.
- Ravallion, Martin, 1990. "Income Effects on Undernutrition," Economic Development and Cultural Change, University of Chicago Press, vol. 38(3), pages 489-515, April.
- Bouis, Howarth E. & Haddad, Lawrence J., 1992. "Are estimates of calorie-income fxelasticities too high? : A recalibration of the plausible range," Journal of Development Economics, Elsevier, vol. 39(2), pages 333-364, October.
- Moffitt, Robert, 1989. "Estimating the Value of an In-Kind Transfer: The Case of Food Stamps," Econometrica, Econometric Society, vol. 57(2), pages 385-409, March.
- Reetika Khera, 2011. "Trends in Diversion of PDS Grain," Working Papers id:3793, eSocialSciences.
- Reetika Khera, 2011. "Trends In Diversion Of Pds Grain," Working papers 198, Centre for Development Economics, Delhi School of Economics.
- James W. Hardin & Henrik Schmeidiche & Raymond J. Carroll, 2003. "Instrumental variables, bootstrapping, and generalized linear models," Stata Journal, StataCorp LP, vol. 3(4), pages 351-360, December.
- Murphy, Kevin M & Topel, Robert H, 2002. "Estimation and Inference in Two-Step Econometric Models," Journal of Business & Economic Statistics, American Statistical Association, vol. 20(1), pages 88-97, January.
- Murphy, Kevin M & Topel, Robert H, 1985. "Estimation and Inference in Two-Step Econometric Models," Journal of Business & Economic Statistics, American Statistical Association, vol. 3(4), pages 370-379, October.
- Behrman, Jere R & Deolalikar, Anil B, 1987. "Will Developing Country Nutrition Improve with Income? A Case Study for Rural South India," Journal of Political Economy, University of Chicago Press, vol. 95(3), pages 492-507, June.
- Bouis, Howarth E., 1994. "The effect of income on demand for food in poor countries: Are our food consumption databases giving us reliable estimates?," Journal of Development Economics, Elsevier, vol. 44(1), pages 199-226, June.
- Ogundari, Kolawole & Abdulai, Awudu, 2013. "Examining the heterogeneity in calorie–income elasticities: A meta-analysis," Food Policy, Elsevier, vol. 40(C), pages 119-128.
- Robert T. Jensen & Nolan H. Miller, 2011. "Do Consumer Price Subsidies Really Improve Nutrition?," The Review of Economics and Statistics, MIT Press, vol. 93(4), pages 1205-1223, November.
- Ecker, Olivier & Qaim, Matin, 2011. "Analyzing Nutritional Impacts of Policies: An Empirical Study for Malawi," World Development, Elsevier, vol. 39(3), pages 412-428, March. Full references (including those not matched with items on IDEAS)