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« Structure within Houston Gujaratis resolved? · Main · Family Matters: Mr. & Mr. Iyer »
April 29, 2011
>1 Billion People...

... are hungry. So notes a widely cited piece by Abhijit Banerjee and Esther Duflo in Foreign Policy.

But is it really true? Are there really more than a billion people going to bed hungry each night? Our research on this question has taken us to rural villages and teeming urban slums around the world, collecting data and speaking with poor people about what they eat and what else they buy, from Morocco to Kenya, Indonesia to India.

Despite rising incomes & cheaper than ever food, for some reason, too many poor folk are simply choosing NOT to expend their $$ on nutrition -

Despite the country's rapid economic growth, per capita calorie consumption in India has declined; moreover, the consumption of all other nutrients except fat also appears to have gone down among all groups, even the poorest. ...at all levels of income, the share of the budget devoted to food has declined and people consume fewer calories.

[Indians] and their children are certainly not well nourished by any objective standard. Anemia is rampant; body-mass indices are some of the lowest in the world; almost half of children under 5 are much too short for their age, and one-fifth are so skinny that they are considered to be "wasted."

So what's going on? And what should "we" do about it?

One culprit are those oh-so-important social obligations & other indulgences -

...In Udaipur, India, for example, we find that the typical poor household could spend up to 30 percent more on food, if it completely cut expenditures on alcohol, tobacco, and festivals....Studies have shown that when very poor people get a chance to spend a little bit more on food, they don't put everything into getting more calories. Instead, they buy better-tasting, more expensive calories.

...We asked Oucha Mbarbk what he would do if he had more money. He said he would buy more food. Then we asked him what he would do if he had even more money. He said he would buy better-tasting food. We were starting to feel very bad for him and his family, when we noticed the TV and other high-tech gadgets. Why had he bought all these things if he felt the family did not have enough to eat? He laughed, and said, "Oh, but television is more important than food!"

If the poor are malnourished despite higher incomes and cheap (and often subsidized) food, it raises some significant developmental economics questions.

Most modern foreign aid debates tend to fall somewhere between 2 poles -

Top down planners who generally focus on large scale solutions based on key macro variables. One example -

[Jeffrey Sachs] has argued that poor countries are poor because they are hot, infertile, malaria-infested, and often landlocked; these factors, however, make it hard for them to be productive without an initial large investment to help them deal with such endemic problems. But they cannot pay for the investments precisely because they are poor -- they are in what economists call a "poverty trap."

Bottom up advocates take a more Hayekian view. For individuals like William Easterly, development "problems" may appear one way from up high but the ground truth is often far different & more complex. At best, our goal should be helping others help themselves. At worst, our top down solutions often backfire because they entrench & pervert the local institutions which were often the problems in the first place.

While Banerjee & Duflo dislike both extremes, their observations do end up at on point much closer to Easterly's than Sachs -

We often see the world of the poor as a land of missed opportunities and wonder why they don't invest in what would really make their lives better. But the poor may well be more skeptical about supposed opportunities and the possibility of any radical change in their lives. They often behave as if they think that any change that is significant enough to be worth sacrificing for will simply take too long. This could explain why they focus on the here and now, on living their lives as pleasantly as possible and celebrating when occasion demands it.

Ahh, that old time consistency tradeoff.

For better or for worse, a deeper recognition of the poor's own agency might still be the best path forward. In other words every man is ultimately captain of his ship and even this often ultimately creates the rising tide. And, for Mr. Mbarbk, the guy quoted earlier who found his TV more appealing than food, participation in a broader economy isn't a nonconsequential thing. Even TV can set in motion the wheels of long term progress.

[prior SM coverage of Duflo's work]
Economics


vinod
POSTED BY vinod @ 5:09 PM

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6 Comments
(anonymous comment)
Author Profile Page Zachary Latif | April 29, 2011 9:34 PM | Reply

I agree with this:

"For better or for worse, a deeper recognition of the poor's own agency might still be the best path forward. In other words every man is ultimately captain of his ship and even this often ultimately creates the rising tide. And, for Mr. Mbarbk, the guy quoted earlier who found his TV more appealing than food, participation in a broader economy isn't a nonconsequential thing. Even TV can set in motion the wheels of long term progress."
(anonymous comment)
Author Profile Page Aniruddha Bose | April 30, 2011 11:06 AM | Reply

There a very interesting debate going on re. the calorific consumption issue. The economist Utsa Patnaik has been engaged in a long running debate where she argues that India's recent 'progress' is a lot of bogus. Indians are actually getting poorer. The drop in food consumption is proof of this fact. It's certainly quite compelling. See
http://www.networkideas.org/featart/apr2004/Republic_Hunger.pdf
(anonymous comment)
(anonymous comment)
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