Despite the scientific advancements and the interconnectedness of the global economy, malnutrition continues to be a pressing worldwide concern. According to estimates from the United Nations, 2.33 billion people faced moderate to severe food insecurity in 2023.
A study conducted by researchers from UC Santa Barbara, the Indian Institute of Management, and the University of Calgary looked into the effectiveness of the world’s largest food assistance initiative. Their findings, which were published in the American Economic Journal, show that the health and economic benefits extend beyond the mere nutritional value of the provided food.
“Malnutrition in India has been a persistent issue,” noted co-author Kathy Baylis, a professor in UCSB’s Geography Department and the Environmental Markets Lab (emLab). “The rates of stunting among children in India are comparable to those in some of the poorest regions of sub-Saharan Africa, even though India is considerably wealthier.” Consequently, India’s Public Distribution System (PDS) stands as the largest food transfer initiative globally and serves as the country’s most expansive social safety net.
PDS functions similarly to the historic food stamp program in the United States, allowing eligible families and individuals to buy bags of rice or wheat at significantly reduced prices. The PDS supports around 800 million people and constituted 60% of India’s social assistance budget during the 2019-2020 period, as outlined in the study.
Changes to India’s food assistance program
Historically, PDS was managed at the state level; however, in 2013 the Indian federal government set minimum standards for the program, which led many states to enhance their support by increasing grain allocations or lowering prices.
The researchers evaluated the differences between states that already complied with the federal standards and those that were required to make adjustments. They analyzed data from a five-year survey undertaken by the International Crops Research Institute for the Semi-Arid Tropics, which was backed by the Gates Foundation, and covered 30 villages in eight states.
The study’s authors monitored children’s height relative to their age as a measure of malnutrition, since this indicator reflects long-term effects better than body mass index alone. “Stunting, which is measured by height for age, is significant because it’s linked to various adverse long-term outcomes, such as poorer health and cognitive difficulties, which can impact education and income,” Baylis explained. This metric is recognized globally.
A balanced diet
The researchers discovered that the average expansion of PDS reduced the incidence of stunting from 36% to 28.8%. “We were honestly surprised by how significant the change was,” Baylis remarked. The most notable improvements were seen in children aged zero to two years, a crucial developmental period highly sensitive to nutritional quality.
PDS’s advantages were especially evident during times of inadequate rainfall. This implies that a nutrition-sensitive safety net like PDS contributes to food security, diminishing the impact of local climatic disturbances on childhood nutrition. The team intends to further explore this facet of the program.
There are criticisms suggesting that subsidized grains might replace more nutritious foods with lower-quality options. However, survey findings indicated that participants in the program actually enjoyed more varied diets. It appeared that the subsidies for staple foods allowed families to allocate more funds toward healthier options, especially animal products like meat and dairy, which contributed significantly to improved height measurements in children.
Far-reaching benefits
The researchers also noted a notable increase in household spending that goes beyond mere savings on food costs. They surmise that better-nourished individuals might work longer hours, enhancing their earnings. The added sense of security may have also allowed people to be choosier about job offerings. This trend was particularly observed among hourly wage workers, not salaried employees. “The impact on income indicates that the value of this program extends beyond just the food it provides,” Baylis pointed out.
This research highlights that food transfer programs can yield numerous benefits, an essential consideration as economists and policymakers evaluate various strategies like direct cash transfers. “Other studies have indicated that giving people cash often raises local food prices,” Baylis explained, “particularly those of nutrient-rich foods, due to heightened demand.” Conversely, providing subsidized food can help lower food costs.
A food assistance initiative helps participants concentrate on their food needs. “People are maintaining their savings within the food sector of their budgets,” she observed.
The authors conclude that the advantages of PDS go well beyond providing calories. “Social safety nets can trigger significant positive effects on areas such as income, health, and human development,” Baylis stated. “Even if the safety network itself isn’t vast, its broader impacts can be far more substantial than we initially anticipated.”
