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GTAP Resource #2484

"Global Nutrition Impacts of Rapid Economic Growth in China and India"
by Hertel, Thomas, Monika Verma, Antoine Bouët, John Cranfield and Paul Preckel

Despite record global economic growth in past decade – malnutrition remains a serious problem in many parts of the world. According to the United Nations’ Food and Agriculture Organization (FAO), about 800 million people (17% of the world’s population) remain malnourished. For these households at a subsistence level of income, changes in commodity market conditions, as may arise from changes in global economic growth and/or trade policy can have serious consequences for nutritional intake. Even a small decline in diet quality can have substantial adverse impacts on health status. On the other hand, a modest income boost, or lower food prices, could have extremely positive impacts. Previously, the links between changes in the global economy and nutritional outcomes have been explored by a relatively wide range of authors (e.g., Fang et al., 2006; Rosegrant et al., 2005).

The goal of this paper is to offer modest extensions of this previous work in three directions. First of all, unlike many of the papers in the nutrition area, we seek to account for the behavioral response of low income households in the face of changing prices and incomes. Clearly when households are faced with a rise in the price of food products, they cannot afford to consume as much, ceteris paribus so consumption much adjust. The extent of this adjustment will depend on the change in real income and the Engel elasticities for each good. In addition, consumers are likely to substitute away from higher cost food items. All of these factors could have an advese impact on nutritional attainment. By estimating and incorporating a demand system into our analysis, we are able to take these factors into account. In so doing, we draw on the work of Rimmer and Powell (1996) and Cranfield et al. (2003a; 2003b) in order to characterize consumer demands across the income spectrum.

Resource Details (Export Citation) GTAP Keywords
Category: 2007 Conference Paper
Status: Published
By/In: Presented at the 10th Annual Conference on Global Economic Analysis, Purdue University, USA
Date: 2007
Created: Hertel, T. (5/28/2007)
Updated: Batta, G. (5/28/2007)
Visits: 3,962
No keywords have been specified.

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