World Hunger Final Exam

"Na Duminike""

A cultural value, ethic, philosophy, community that treats all as equals. Something that does not exist in most developed countries.

Policy Instruments for Improving Food Security

1. Closing income gaps - giving money or giving food

2. Closing food access gaps - international and domestic food aid

3. Price and access gap policies - change market prices for food

4. Production gaps - increasing agricultural production

5. Closing dietary diversity gaps - fortification

6. Closing dietary diversity gaps - production and information efforts

Ethics of Food Security (why we care)

- Tells us what to do

- Tells us WHO should do something

- Tells us who should be targeted for interventions

Philosophical and Ethical Approaches to Food Security Policy

1. Food security as a moral dictate - it is a religious or personal moral responsibility for everyone to have enough food.

2. Food security as a fundamental right - Food is a necessary thing for survival, so everyone should have the right to a minimum diet.

3. Food security as an optimal economic policy - Cost benefit analysis (do the benefits outweigh the costs)

Food Security Philosophy and Micronutrients

Food security is thought of as macro-nutrient (calories and protein) issues

Role of Economics in Providing Food Security

Economics....

- Tells us that people respond to incentives, price and income incentives.

- Uses marginal benefit vs. marginal costs to calculate how much of something to do

- Helps us understand how price policies and interventions in markets can help provide food security

- Can help us figure out the costs and benefits of different policies

Role of Economic Incentives in Policies

Economics asserts that people will respond to price and income incentives in what they do and what they buy

Government's Role in Combating Hunger and Malnutrition

1. Moral leadership or guarantor of a human right

2. Gov't can conduct policies and interventions at scale

3. Coordination of efforts

4. Regulatory interventions

5. Information interventions

6. Cost effectiveness of government interventions

7. Public good nature of benefits

Cost-Benefit of Actors in Nutrition Interventions

- Government Advantages: Well financed, long term view, mobilize large resources

- Government Disadvantages: slow & bureaucratic, politicized decision making

- Non-Governmental Org Advantages: fast moving, connections to the community

- Non-Gov Org Disadvantages: coordination issues, individualized decision making, low sustainability

- Philanthropies Advantages: can access financing, can move fast

- Philanthropies Disadvantages: coordination issues, donor driven agenda, less accountable ot community, low sustainability

- Other Countries Adv: well financed, long term view, mobilize large resources

- Other Countries Disad: donor driven agenda, coordination issues w host gov

Who should be helped by Nutrition Interventions...

Children, mothers, poor people,, people of a certain region

Why prioritize some people and not others?

- Better return on investment" for some types of people (cost-benefit calculations)

- Morality

- Vulnerability

Nutrition Policy Targeting Matrix

Targeting:

- "leakage" to nontargeted individuals

- "exclusion" missing intented beneficiaries

Consequences of targeting errors:

- Over Inclusion: added costs, disincentives to work

- Exclusion: Lower impact, humanitarian/moral consequences

Means (income) Testing Poverty Programs

Poverty programs that have income thresholds determined by your income, wages, and assets

Poverty Policy Targeting Matrix

Poverty has clearer lines for determining who is eligible, than food insecurity

How US feels about Targeting Errors

- We have leakage

- Don't care about exclusion

- Exception to "we hate leakage" was the short term COVID pandemic efforts

Reducing Administrative Burdens

Code for America has developed a scorecard in the context of safety net services

-Equitable access

-Effective Delivery

-Compassionate Integrity

Examples of Nutrition Policies/Programs in the US

Food labeling, USDA food pyramid, food stamps, WIC, school lunch/breakfast programs, fortification programs, USDA food distribution programs

Macro Nutrient Gap Policies

- Income based interventions

- Price based interventions

- Access based interventions

- Production based interventions

- Information based interventions

Micro Nutrient Gap Policies

- Fortification

- Information

- Rules & Regulations

- Diversification of Production

Timing Matterns to Nutrition Interventions

- Nutrition interventions should be done in advance of an acute problem

- Many interventions may be seasonal (farm communities)

- Getting the timing wrong may lead to leakage or exclusion

Supplemental Nutrition Assistance Program (SNAP)

SNAP provides food benefits to low-income families to supplement their grocery budget so they can afford the nutritious food essential to health and well-being

- 12% of the US population or 41.2 million people are enrolled

Two types of targeting in the SNAP program

- Level of food insecurity

- Level of poverty

Key Issues of Food Security

- Availability; ensuring an adequate food supply to provide for the nutritional needs of the population

- Access; ensuring that incomes and food priced together maintain real purchasing power sufficient to ensure the ability to obtain a nutritionally satisfactory diet

- Utilization; ensuring that food within the household is used effectively to maintain the health of all members

Food Assistance Programs (food-related transfers)

Any intervention to address hunger and undernutrition (food stamps, WIC, food subsidies, food price stabilization)

Food Aid

International concessional flows in the form of food or of cash to purchase food in support of food assistance programs

Distinction between Food Assistance Programs and Food Aid

International sourcing of concessional resources tied to the provision of food, whether by a donor or to a recipient

Program Food Aid

Subsidized deliveries of food to a central gov that subsequently sells the food and uses the proceeds for whatever purpose. Program food aid provides budgetary and balance of payments relief for recipient governments

Project Food Aid

Provides support to field-based projects in areas of chronic need through deliveries of food to a government or NGO that either uses it directly or monetizes it, using the proceeds for project activities

Emergency/Humanitarian Food Aid

Deliveries of free food to GO/NGO agencies responding to crisis due to natural disaster or conflict

Food Aid - Donor Driven Resource Myths...

1. American food aid is primarily about feeding the hungry

2. Food aid is an effective form of support for American farmers

3. American food aid is no longer driven by self-interest

4. Food aid is wholly additional

5. Food aid builds long term commercial export markets

6. Cargo preference laws effectively support the US martime industry

7. NGOs are a force for change in food aid

Who Benefits from Donor-Driven Resource

- Small # of food vendors

- Small # of shippers

- NGOs

Targeting Issue in Food Aid Management

- "leakage" to nontargeted individuals in the household, region

- Missing intended beneficiaries (errors of exclusion)

Timing Issues in Food Aid Management

Aid should flow counter-cyclically to stabilize food availability and it doesn't

- Food aid flows budgeted on monetary not physical basis

- Delivery lags are great

Disincentive Effects in Food Aid Management

- Product price effects

- Labor supply disincentives

- Gov policy effects given persistence

Incentive Effects in Food Aid Management

- Factor prices/availability

- Risk effects

- Labor supply/availability

Procurement Modalities in Food Aid Management

Role for local purchases/triangular transactions

Monetization in Food Aid Management

Food given to NGOs that they then sell in a developing country and use the money for their programs

Barrett and Maxwell Conclusions - 3 key roles

- Short term humanitarian assistance to food-insecure populations

- Provision of longer term safety nets for asset protection

- Limited targeted "cargo net" interventions for asset building among chronically poor/vulnerable populations wehre food aid is relatively efficient

What Do our Food Policies Do to Markets?

1. Changing supply with food aid or new agricultural technologies

2. What do subsidized (artifically low) prices do to food supply and demand

3. Using income elasticities to target undernutrition

Ways to Change Food Supply

- Increase the price so that farmers produce more

- Increase the quantity supplies (available) for the same price

Increasing Supply with Inelastic Demand

- Price goes down a lot

- Not much increase in demand

Increasing Supply with Elastic Demand

- Small decrease in price

- Large Increase in quantity demanded

Income Elasticity of Demand for Food

- Inferior Goods; when your income goes up you buy less of it. Income elasticity less than zero

- Normal Goods; when your income goes up you buy more of it. Income elasticity greater than zero

- Luxury Goods; When your income goes up you buy disproportionately more of it. Income elasticity greater than 1

Engel's Law

As wealth increases, the proportion of income spent on the food goes down

- Overall food is income inelastic (less than 1)

Giving cash vs. Food

Cash can be very effective in the right circumstances in reducing undernutrition

Fortification Basics

Provides a more targeted and specific effort at providing micro nutrients ot the population

- Want to target missing micro nutrients in the diet that are... hard to get otherwise, expensive to get otherwise

Common Foods fortified in the US

Salt (iodine), Milk and dairy products (vitamin d and a), breakfast cereals, bread, fruit juices, some eggs and egg products

6 Underlying Rules to Follow in the US from AMA Guidelines

1. The intake of nutrient, in the absence of fortification, is below the desirable level in the diets of a significant number of people.

2. The food from which the nutrient is to be derived is likely to be consumed in quantities that will make a significant contribution ot the diet of the population in need

3. The addition of the nutrient is unlikely to create an imbalance of essential nutrients

4. The nutrient added is stable under proper conditions of storage and use

5. The nutrient is physiologically available from the food to which it will be added

6. There is a reasonable assurance against intake sufficiently in excess to be toxic

Fortification in the Rest of the World

- 97.5% of people

- Those at greatest risk of deficiency

Food that Meets Fortification Guidelines

- staple foods that everyone consumes

- Foods that are "normal" goods in an income elasticity sense

- Foods with a low price elasticity of demand

Fortification

The addition of nutrients to a food that were not originally present in that food, or were present in a different amount.

Enrichment

The addition of vitamins and minerals to a food in order to restore those nutrients to levels that were found in the food prior to storage, handling, and processing

Expanding Supply with New Technologies

New agricultural technologies can help lower prices of foods by bringing more food to market for the same or lower cost.

- These technologies shift out the supply curve (produce more quantity for the same price)

Expanding supply with a New Technology

- New tech shifts out the supply curve

- Generates new supply and demand equilibrium

- Prices go down and quantities consumed go up

How to lower the cost of inputs

- Subsidies

- Increase competition between input sellers

- Improve roads to lower transportation costs

Green Revolution Success

- Large yield increases in developing countries, less so in Africa

- Lowered priced in India by 20% due to increased supply

New Technologies - Local Research & Development (R&D)

Invest in agricultural research in your own country/state in order to produce more food locally. Benefits will both spill out and spill in from other countries (externalities)

New Technologies - International R&D

International crop research centers (CGIAR system) were instrumental in creating the crops that became the "Green Revolution"

Who should do what? Governments -

Governments...

Can mobilize lots of resources, coordiate efforts, has regulatory authority, stable, can have a long term horizon

Who should do what? Private Sector -

Private Sectors...

Profit motive, can move quickly, has incentive to get it right, bad at coordinating efforts, can have many companies to scale efforts, can be very localized

US Land Grant University System and Ag Experiment Stations

Created an agricultural experiment station in every state

- Purpose was to provide an implicit subsidy to farmers by funding R&D and extension work to get better technologies to farmers

-Fov funds the research. Research provides new tech to help farmers. Tech gets diffused to farmers who can produce more food for the same price. Food prices in the US stay low bc of highly productive farmers

Consultative Group on International Agricultural Research (CGIAR)

A group of international crop research organizations throughout the world working on the major crops of the world.

- Started by the Rockefeller Foundation

- International

Ag Research and Traveling

Ag research generally does not travel well

How to improve Dietary Diversity

1. Improve availability of diverse & nutritious foods

2. Improve access to diverse & nutritious foods

3. Improve demand for dietary diversity & higher nutrition

4. Fortification to improve nutrient content of food; provides availability and usually access, and either avoids needing improved demand, or induced food companies to create improved demand

Ways to Sort Types of Food Consumption by Nutritional Usefulness

1. Nutrition-poor foods

2. Under-consumed foods or food "missing" during part of the year

3. Over-consumed foods

Interventions should improve #'s 1 and 2, while reducing the importance of #3