Poverty, Undernutrition, and Famines

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Poverty, Undernutrition, and Famines

• In the first part of this course we have been
  dealing with poverty, growth, institutions, and
  microfinance
• But we have not yet seen many other dimensions of
  poverty, which are crucial for policy
• In particular, in todays class
• How can we accurately measure the extent of
  poverty
• What causes acute levels of undernutrition and
  famines?
• How can one best deliver aid to a famine-stricken
  region?

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1) Measuring Poverty

• Measuring poverty based on the notion of a
  poverty line
• Five concerns
• Expenditure or item-by-item consumption?
• Absolute or relative?
• Temporary or chronic?
• Households or individuals
• A fixed notion?

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• Head count
• Head count ratio

• Poverty gap ratio

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(c) Income gap ratio
Note All ignore relative depravation
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2) Causes of poverty

• Lack of assets and undernutrition, obviously
  interconnected
• Energy input
• Nutrition and work capacity
• Discrimination against females, both adults and
  children
• Credit and Insurance

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3) Famines and aid

• A. Sen argues that a distinction should be made
  between starvation and famines, and
• That starvation and famines are not due to FAD,
  but distribution
• Food entitlements depend on individuals assets
  and the amount of food individuals can obtain via
  exchange
• Below a certain threshold, individuals unable to
  acquire food against those assets, and can
  therefore experience starvation and famines

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3) Best way of delivering aid to a
famine-stricken region (Coate 1989) Note we
are dealing with aggregate shocks here

• First Who are the vulnerable?
• Three possible scenarios, easy to distinguish
  the vulnerable
• A rural region populated by large and small
  scale subsistence farmers, and suppose that there
  is a crop failure
• A rural region populated by farmers and landless
  laborers, and there is a bad harvest
• A rural region populated by high and low wage
  earners, and food prices increase

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Suppose an scenario where famine- stricken region
is originally exporting food, importing food, or
neitherAnd suppose that an aid agency wishes to
minimize mortality rates
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Now suppose that the famine-stricken region is
experiencing a surplus of food and is originally
exporting food. Are cash handouts a good strategy?
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Now suppose that a famine-stricken region is
originally importing food. Are cash handouts a
good strategy?
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Now suppose that a famine stricken region is
neither importing nor exporting food. Are cash
handouts a good strategy?
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In Sens view Famines can be prevented via

• Employment creation
• Public holdings of food stock
• Health
• Education
• Clean water and sanitation
• DR adds
• Land reforms
• Human capital
• ? Next Class Population and Rural Urban
  Migration (Consult syllabus)