Rao 5a the choice of a policy strategy

FOOD SECURITYConcepts, Basic

Facts,and Measurement

Issues

June 26 to July 7, 2006Dhaka, Bangladesh

Rao 5a: The Choice of a Policy Strategy

Learning: Trainees will learn that while strategies focused exclusively on supply or entitlements or nutrition will almost never be relevant, relative weights attached to these pure strategies deserve careful consideration. They will learn to identify key elements of each pure strategy in any such exercise.

Brief Contents• policy strategies broadly classified: 1) supply,

2) entitlement promotion, and 3) utilization/nutrition approaches

• choice of strategy governed by dominant food deficit types coupled with major problems in utilization and stability

• key features of production and supply based approaches

• rationale & objections to self-sufficiency; self-sufficiency vs self-reliance

• general role of poverty reduction, safety nets• food-based nutrition interventions: dietary

improvement, food fortification• micronutrient supplementation & related

health interventions

Policy Strategies• Corresponding to the 3 analytical

approaches (availability, access, utilization), we distinguish 3 broad policy strategies– availability and supply oriented

[increase supplies]– access and demand oriented [increase

demands]– utilization and outcomes oriented

[improve nutrition]• Clearly, ALL THREE are needed to

assure FS• Moreover, it is usually a mistake to

assume D & S sides are "independent” of each other or that D & S are “independent” of utilization!

Complementarities• Supply approaches have indirect

effects on food demand (e.g. through lower prices inducing increase in quantity demanded, or even shifting the Demand Curve through actual-income changes of the producers, not just the real income effect of the price change)

• Demand-stimulation will usually also cause changes on the supply side (e.g., through higher prices inducing supply responses, or even shifting the Supply Curve through altering the capabilities of the producers)

Complementarities (contd.)

• Improved utilization/nutrition can be expected to alter both food supply and demand prospects significantly insofar as a better nourished population can both produce more food and have the capability to demand more food as well.

• A sensible approach to food security must therefore incorporate all 3 elements, aiming to augment food supplies, enhance food demands, and improve food utilization and nutrition by improving food quality and safety and dietary balance.

Choice of a Policy Strategy

• Which strategy? While “ALL THREE” is the correct answer, the emphasis will also depend on context i.e., the MAIN TYPE OF FOOD DEFICIT prevalent in the country.– If DEMAND DEFICIT is the main issue,

THEN, focus on policies to increase domestic supply or F/E earnings

– If SUPPLY DEFICIT is the main issue, THEN, focus on employment and income generation policies

– If DIETARY IMBALANCE is the main issue, THEN, focus on policies for improved nutrition, food safety, health care, drinking water and sanitation

[see figure]

Choice of a Policy StrategyFigure 2.12: Food deficit types & priority

approachesto food security required

a) Large production/supply deficits: mainly supply-based approaches required             

b) Large demand deficits, primarily demand-based approaches required           

Production and Supply Based Approaches

• Policies to increase food production and domestic supplies comprise:– agricultural research, training and extension– agricultural input supply– mechanization– irrigation– rural infrastructure and institutions– land reform– agricultural marketing and pricing policies– agricultural credits.

• In short, , practically everything falling under agricultural sector development.

Table 2.2: Food production constraints and policy

measures for their alleviationConstraints on Food Production e.g. of Policies to Overcome the Constraints

Technological constraints - Agricultural research, extension and training, irrigation, rural credit, etc.

Manpower & management constraints - Promotion of mechanisation

  - Agric. research and extension to promote technical change

Land constraints Measures to improve utilisation, e.g. by: irrigation, mechanization, research & extension, land reform

Infrastructural and institutional constraints

- Improvements of roads, road maintenance, etc.

  - Improvements of input supply, extension, marketing services, and co-operative institutions

Marketing constraints Improvement of agric. marketing system, e.g. byinfrastructure investment, institutional reform, special subsidies, credits, etc.

Insufficient production incentives Reducing production costs, e.g. by input subsidies, promoting technical change via extension services, improved marketing and rural infrastructure, etc.

Figure 2.13: Impacts of policy measures to reduce the costs

of food production

Figure 2.14: Impacts of policy measures to alleviate

constraints to food production

Self-Sufficiency: Is There a Rationale?

• Food self-sufficiency refers to the extent to which a country can satisfy its food needs from its own domestic production– greater control or less political dependency on

world markets or other nations– added risks of world markets (especially when

they are "thin") for both consumers and producers

– concern about maintaining the livelihoods of the poor and vulnerable

– FS can be damaged due to "excessive" dependence on food imports

– [PREBISCH] move away from primary sector specialization

• Self-sufficiency was a key aspect of the Lagos Plan

Self-Sufficiency: Is There a Rationale?

• Question: Can developed countries' agricultural policies be rationalized by SS?

• Example: India has considerably reduced its food insecurity through developing its domestic food production. Cereal production increased from 90 million tonnes in 1970 to 130 million in 1985. To import this much additional grain would have cost $10,000 million per year.

Self-Sufficiency vs. Food Security?

• 1. Food self-sufficiency looks only at national production as the sole source of supply, while food security takes into account commercial imports and food aid as possible sources of commodity supply.

• 2. Food self-sufficiency refers only to domestically-produced food availability at the national level, food security brings in elements of stability of supply and access to food by the population

Self-Sufficiency vs. Food Security?

• Evaluate: food self-sufficiency is linked to an emphasis on the need for self-reliance, an auto-centric approach, whereas food security incorporates international specialization and comparative advantage

• Must we have to choose between the two?

Subsistence VS Market Integration: Household-

Level Arguments• The arguments, about risks of

commercialisation and market dependence, have also been made at the level of the farm household. It is argued that food insecurity is increased when the poor become more dependent on markets for their food.

• One eminent economist argues that…

“the farther away from direct food cultivation a group is, i.e. the more markets it has to go through to convert endowments into actual consumption, the more liable to starvation it is. Thus, cattlemen of Sahel and Ethiopia, the fishermen of Bengal or tradesmen suffer more than agricultural labourers who suffer more than sharecroppers and peasant cultivators... Contrary to market intermediation bringing smooth and beneficient outcomes, it is those who do not have to go through a purchase or sale to convert their income into consumption who are least vulnerable to a decline in real grain wage. The direct producer of grain, either as landowner or sharecropper and the worker who receives a grain wage are safer than he who receives money rent or money wage.”

Desai, quoted in S. Devereux, 1993

Discuss: what are the pros and cons of the above argument?

Poverty Reduction, Safety Nets

and Food Security• Role of government:

– provide institutional basis to prevent market failures, monopolization and malfunctioning

– encourage supply growth– create a framework of rights and

obligations: property rights vs right to life?

– policies toward FS may be virtually the only MAJOR social security instrument available in many poor countries.

Box 2.4: The State andFood Security in History

• … long history of state action to protect subjects from starvation and extreme want … not just due to benevolence … but in order to … claim the right to power by enhancing food security. This function has often been central to the notion of state legitimacy.

• In ancient Egypt, the state undertook a form of buffer stock storage

• Grain and bread rations were distributed to the poor in Rome and ancient Greece when war or bad harvests created scarcity, or when there was fear of public unrest.

• In China, during the Manchu dynasty, emergency relief in the form of cash or food, low price grain sales and food loans were all employed … at times of crisis.

• Public employment schemes have also been used by various governments to enhance food security. They were introduced by Indian rulers as early as the fourth century B.C. Relief during the potato famines of the 1840s, in both Ireland and the Highlands of Scotland, was in the form of what would now be called food-for-work projects.

Food Security, Population,and Environment

• Race between population growth and food supply (paleo-Malthusianism)

• Race between population growth and food supply without causing environmental degradation (neo-Malthusianism)

• Population is growing fastest for the poorest people. Why?– because labour is their main asset and

children are valued for their hands?– or because they have no other form of security

to satisfy the precautionary or retirement motives?

• IS high population growth an important factor in immiserisation and FIS?

• Question is: how to ensure a faster demographic transition (movement from a situation of high birth rates and high death rates to low birth rates and low death rates). Evidence shows keys are: overall prosperity and in particular the prosperity of the poorest in the country.

• As food security increases, and poverty decreases, fertility rates decline. This is to a large extent because of the decrease in uncertainty facing poor families. The infant mortality rate declines, so children are more likely to survive.

• Another element concerns the position of women in society. As women become more educated and have more power within the household, then fertility rates fall. Women’s options increase and they are no longer valued primarily for their fertility.

Food Security, Population,and Environment