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Ashley Dean
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Q&A with FSE visiting scholar and food aid expert Barry Riley.

President Barack Obama’s 2014 budget proposal promises significant food aid reform that will enable the United States to feed about 4 million more people without a significant increase of the current $1.8 billion spent on feeding the world's most hungry. Since the food aid program's inception in 1954, the U.S. has helped feed more than 1 billion people in more than 150 countries, and remains the largest provider of international food aid.

The intention of the reform is to make food aid more efficient, cost effective, and flexible. It aims to use local and regional markets to lower the cost of food and speed its delivery, and calls for the use of cash transfers and electronic food vouchers.

The proposed reforms would also end monetization—the sale of U.S. food abroad to be sold by local NGOs for cash. This practice has been criticized for hurting vulnerable communities by depriving local farmers of the incentives and opportunities to develop their own livelihoods. Several studies, including one by the Government Accountability Office, found monetization to be costly and inefficient—an average of 25 cents per taxpayer dollar spent on food aid is lost.

Barry Riley, a food aid expert and visiting fellow at the Center on Food Security and the Environment, discusses his perspective on the importance of these new reforms, their chances of passage, and the country's current role in international food aid.

Why is local procurement such an important addition to food aid reform?

An increase of funding for local and regional procurement is the most important programmatic element of the proposed reforms. It would help managers working in food security-related development programs to determine for each emergency what commodities are most appropriate and where they can be procured most quickly and inexpensively. Some studies have shown local and regional procurement of food and other cash-based programs can get food to people in critical need 11 to 15 weeks faster at a savings of 25-50 percent. Equally important, local procurement is less likely to disrupt local economic conditions, but rather promote self-sufficiency by increasing demand (often for preferred local staples) and incomes of local producers. The move to 45 percent local (and 55 percent tied) procurement is a BIG step, and one to face strong opposition from American commodity interests and U.S.-flag shippers. 

How difficult is it to ensure vouchers and electronic cash transfers are getting into the hands of people that really need the aid?

Vouchers (and similar urban coupon shops) have been used many times over the past decades as a food transfer mechanism (also sometimes used in food for work programs) enabling the recipient to trade the voucher(s) for foodstuffs when it is most convenient or when they are most needed. Electronic vouchers are new, and how well they work depends on local situations. In places like urban Latin America, Africa and India, it probably could be made to work quite well; the technology is evolving quickly that would enable this sort of transfer mechanism.  

Rural Ethiopia, Burkina Faso, Central African Republic, Malawi – probably not so well. I’m admittedly skeptical that electronic transfers of purchasing power to remote areas would be sufficient in most cases to motivate traders to move food to these hungry areas. Their risks are extremely high and, in my experience in Africa, traders will only deliver food to remote rural areas (inevitably over very bad roads) if they can command prices considerably higher than costs plus a high risk premium.

Why aren’t international food aid organizations more in favor of direct dollar support for local operating costs?

There is (and has long been) opposition among many of the NGOs to the President’s proposal to replace “monetization” with a promise of on-going direct dollar support for the local operating costs of NGO food security-related projects. They believe it will continue to be easier to get Congress to approve money to buy American food commodities to ship overseas than to get approval for dollars to ship overseas, particularly in light of tightening budgets. These NGOs have tended, over the years, to receive a sympathetic ear from Congress.

The proposal shifts oversight of the food aid program from the Agriculture Committees within the U.S. Department of Agriculture (USDA) to the Foreign Affairs/Relations Committees of the State Department’s U.S. Agency for International Development (USAID). What is the likelihood of Congress approving this transfer?

The chance of that happening, in this of all Congresses, is about the same as winning the Power Ball Lottery. Crusty committee chair-people are extremely sensitive to reductions in their empires and the agriculture committees – especially in the Senate – are powerful committees. On top of that, there are so many elements in the overall 2014 federal budget creating heartburn on the Hill that food aid considerations are far, far, far down the line. The best the President is likely to get in the present divided Congress are hearings and a continuing resolution of some sort.

What did you wish to see in the food aid reform proposal that was not addressed in this budget?

Change, if it ever comes, will likely be incremental and halting. I’ll be happy to see any step, however small, in the right direction. The total end of tied procurement would be at the top of my wish list. Even more important, perhaps, iron-clad, multi-year commitments of funding to food security programs intended to overcome long-term institutional impediments to achieving enduring food security in low income food deficit situations…and sticking with such commitments for 15 years.

What role does food aid play in advancing American foreign policy goals?

Most importantly, by being the single largest source of food commodities to the World Food Program in confronting disaster and emergency situations. Food support to American NGOs has been under-evaluated over the past 40 years. I’ll be talking about this later in the book I am writing, but these small projects were all that kept agricultural development (and early food security efforts) going in many small countries during the “dark decades” when international finance institutions and bilateral donors were not financing agricultural development. There are valuable on-the-ground lessons in that NGO food-assisted experience still waiting to be assessed.

Let me add, given what we know about the onset of serious climate change in the decades to come, the need to supply large amounts of food to populations suffering severe food deprivation will probably grow in the future. Where will the food come from and who will pay for those future transfers?

While the U.S. remains the largest provider of food aid, what can the EU and Canada teach the U.S. about food aid policy?

Donors hate to think that other donors have something to teach them. But, of course, they always do. The Canadian and European experience with food aid is best summed up in the way their objective has come to be restated over the past 15 or so years: not “food aid” but “aid for food.” The purpose of assistance intended to improve food security is to improve either, or both, availability and access over the long term (leave nutrition aside for a moment).

European and Canadian assistance can be much more flexible in choosing the instruments – food, cash, technical assistance, training, institutional strengthening, public policy, public-private cooperation, etc. – required to achieve a realistic food security goal which I would describe as pretty good assurance that most people can get their hands on the food they need most of the time. Commodity food aid, in some form – or the promise of its ready availability when needed – will probably need to be part of the total array of inputs required for the several years needed in particular food insecure countries to achieve that “pretty good assurance.” Europe and Canada are closer to understanding this and have become appropriately flexible in concerting resources to get it done. That’s the lesson.

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Ashley Dean
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China’s commitment to agricultural development over the last thirty years has dramatically transformed the country’s economy. Rural income per capita has risen an astounding 20 times after 30 prior years of stagnation. Its poverty rate (US$1.25/day) has dropped from 40 percent to less than five, and 350 million rural people between the ages of 18-65 are now working in the industrial or service sector, enjoying rising wages and new economic opportunities.

This rapid transformation is largely the result of three key agricultural policy decisions: putting land in the hands of farmers, market deregulation, and major public investment in the agricultural sector. Although China must now contend with extreme inequality, high levels of pollution, and an aging farming sector there are still lessons to draw from China’s experience that could hasten the transformation of other developing countries.

China expert and agricultural economist Scott Rozelle broke these lessons down at FSE’s fourteenth Global Food Policy and Food Security Symposium Series last week, opening with an underlying theme of the series.

“Growth and development starts with agriculture,” said Rozelle. “Agriculture provides the basis for sound, sustained economic growth needed to build housing, invest in education for kids, start self-employed enterprises, and finance moves off the farm.”

To prove this point he referenced China’s ‘lost decades’ (1950s-1970s) when 80 percent of the population lived in the rural sector and relied on communal, subsistence agriculture. Poor land rights, weak incentives, incomplete markets and inappropriate investments left the average rural farmer poorer at the end of 70s than they were in the 50s with almost no off-farm employment growth.

So what changed? Incentives, market deregulation and strategic investments by the state were key.

Creating the right incentives

In 1978 the Chinese government broke the communes down into small “family farms” such that every rural resident was allocated a small parcel of land. A family of five farmed an area the size of a football field. While they did not own nor could sell the land, they had the right to choose what crops and inputs they used and the right to the income generated from their land.

“Incentives are important, and can be enough in the short run,” said Rozelle. “Hard work led to money in the pockets of farmers and China was off.”

“Every two and half years China added another California in term of agriculture,” said Rozelle.

Between 1979 and 1985 productivity for wheat, maize, and rice went up 50 percent using the same amount of labor, land and inputs. Agriculture across the spectrum has grown at an astounding rate of 5 percent since 1988 (about four times the population growth rate). Livestock and fisheries have grown even faster – accounting for most of the output of the agricultural sector by 2005.

Income growth from farming enabled family members to begin to seek work off the farm. Between 1980 and 2011, off-farm work increased 71 percent with more than 90 percent of households reporting that at least one family member worked off the farm.

Increasing efficiency through liberalization and investment

Another key policy decision was China’s commitment to market liberalization and investment in public goods.

“Markets can be an effective, pro-poor tool of development,” said Rozelle. “A remarkable partnership is formed when you let farmers do production and government do infrastructure…let markets guide decisions.”

The government dismantled state-owned grain trading companies and deregulated trading rules. Prices were set once a week the same day across China to better integrate markets, and eventually prices for major crops closely mirrored those of world prices. Villages began specializing in crops and livestock and incomes of the poor increased. By not providing government input subsidies (e.g, pesticides, fertilizers), traders were incentivized to participate in the market.

“Giving land to farmers and letting the private sector emerge is an easy thing for governments, even without a lot of money, to do,” said Rozelle.

The government provided more indirect market support by publicly investing in better roads, communications, and surface water irrigation. Groundwater was left to the private sector. There were no water or pumping fees nor subsidies for electricity, keeping it completely deregulated. As a result, 50 percent of cultivated land in China is irrigated, compared to 10 percent in the US and only four percent in sub-Saharan Africa.

Finally, China has invested heavily in agricultural research and development (R&D). One percent of China’s agricultural GDP is now invested in agricultural R&D while US investment has fallen over time. US$2 billion alone goes to investments in Chinese biotechnology.

Despite major investment, China only has one major success story to show for so far. The introduction of Bt cotton led to a significant drop in pesticide use (with important health benefits for farmers), and drop in labor and seed price; resulting in a huge 30 percent increase in net income.

“GM technology benefits exist but big policy decisions still need to be made in the face of much resistance both in China and elsewhere in the world on its application,” said Rozelle.

Status of China’s economy

China has largely solved the country’s macro-nutrient food security problem at the household level (>3000 Kcal/day/person) and millions have been lifted out of poverty. Practically all 16-25 years old are now working off the farm.

“This is a real transformation, and one that could not have happened without a major investment in agriculture,” said Rozelle.

While China’s agricultural accomplishments have been major, Rozelle recognizes the system is far from perfect. For starters, there are serious food safety concerns due to lack of traceability. An astounding 98 percent of Beijing consumers think their food is tainted, said Rozelle.

Water is being pumped like crazy and farmers are aging. The younger generation is neither willing nor interested in following in their parents’ farming footsteps. To make up for a labor deficit farmers are applying huge amounts of fertilizer on their land with serious environmental consequences. As a result of changing demographics and an increasing demand for meat, fish, fruits and vegetables, China is likely to be a net importer of food in the long run.

China also faces major urban and rural inequality issues. Even though wages have risen, inequality has not fallen, largely a result of China’s decision not to privatize rural land.

“Rural people have no assets on which to build wealth while urban people were given assets in the form of housing,” said Rozelle. “Housing prices in major cities in China now rival those in the Bay Area!”

The Chinese government fears losing control of the land, but this comes at a price of less individual incentive to invest and inability to build larger farmers. As agricultural growth slows, Rozelle worries high levels of inequality could lead to instability.

Adding fuel to the fire, investment in rural health, nutrition, and education remains far from sufficient. Only 40 percent of the rural poor go to high school resulting in 200 million people who can barely read or write.

“What’s going to happen in 20 years when low skill manufacturing jobs move to other countries?” asked Rozelle. “The rural, uneducated poor are going to become unemployable.”

China’s record leaves room for improvement, but presents a strong case for supporting smallholder agriculture. For those countries emerging out of their own lost decades, smallholder agriculture should remain a primary focus of investment and development.

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Abstract:

Because of the health and economic costs of childhood obesity, coupled with studies suggesting the benefits of comprehensive (dietary, physical activity, and behavioral counseling) intervention, the U.S. Preventive Services Task Force recently recommended childhood screening and intervention for obesity beginning at age 6. Using a longitudinal data set consisting of the body mass index of 3,164 children up to age 18 and another
longitudinal data set containing the body mass index at ages 18 and 40 and the presence or absence of disease (hypertension and diabetes) at age 40 for 747 people, we formulate and numerically solve—separately for boys and girls—a dynamic programming problem for the optimal biennial (i.e., at ages 2,4,...16) obesity screening thresholds. Unlike most screening problem formulations, we take a societal viewpoint, where the state of the system at each age is the population-wide probability density function of the body mass index. Compared to the biennial version of the task force’s recommendation, the screening thresholds derived from the dynamic program achieve a relative reduction in disease prevalence of 3% at the same screening (and treatment) cost, or—because of the flatness of the disease versus screening trade-off curve—achieves the same disease prevalence at a 28% relative reduction in cost. Compared to the task force’s policy, which uses the 95th percentile of body mass index (from cross-sectional growth charts tabulated by the Centers for Disease Control and Prevention) as the screening threshold for each age, the dynamic programming policy treats mostly 16-year-olds (including many who are not obese) and very few males under 14 years old. Although our results suggest that adult hypertension and diabetes are minimized by focusing childhood obesity screening and treatment on older adolescents, the shortcomings in the available data and the narrowness of the medical outcomes considered prevent us from making a recommendation about childhood obesity screening policies.

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Management Science
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Yan Yang
Jeremy D. Goldhaber-Fiebert
Lawrence M. Wein
Lawrence M. Wein
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Abstract:

Several aid groups have proposed strategies for allocating ready-touse (therapeutic and supplementary) foods to children in developing countries. Analysis is needed to investigate whether there are better alternatives. We use a longitudinal dataset of 5,657 children from Bwamanda to construct a bivariate time-series model that tracks each child’s height-for-age z score (HAZ) and weight-forheight z score (WHZ) throughout the first 5 y of life. Our optimization model chooses which individual children should receive readyto-use  therapeutic or supplementary food based on a child’s sex, age, HAZ, and WHZ, to minimize the mean number of disabilityadjusted life years (DALYs) per child during 6–60 mo of age [which includes childhood mortality calculated from a logistic regression and the lifelong effects of stunting (i.e., low HAZ)] subject to a budget constraint. Compared with the strategies proposed by the aid groups, which do not use HAZ information, the simple strategy arising from our analysis [which prioritizes children according to low values of a linear combination of HAZ, WHZ, and age and allocates the entire budget to therapeutic (i.e., 500 kcal/d) food for the prioritized children] reduces the number of DALYs by 9% (for the same budget) or alternatively incurs the same number of DALYs with a 61% reduction in cost. Whereas our qualitative conclusions appear to be robust, the quantitative results derived from our analysis should be treated with caution because of the lack of reliable data on the impact of supplementary food on HAZ and WHZ, the application of our model to a single cohort of children and the inclusion and exclusion errors related to imperfect food targeting.
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Proceedings of the National Academy of Sciences
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Yan Yang
Jan Van den Broeck
Lawrence M. Wein
Lawrence Wein
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Background. Despite growing wealth and a strengthening commitment from the government to provide quality education, a significant share of students across rural China still have inadequate access to micronutrient-rich regular diets. Such poor diets can lead to nutritional problems, such as iron-deficiency anemia, that can adversely affect attention and learning in school. Large scale policies in Northwestern China have attempted to tackle these nutritional problems using eggs.  The overall goal of this paper is to assess the impact of the government’s egg distribution program by comparing the effect on anemia rates of an intervention that gives students an egg per day versus an intervention that gives students a chewable vitamin per day. We will also assess whether either intervention leads to improved educational performance among students in poor areas of rural China. To meet this goal, we report on the results of a randomized controlled trial (RCT) involving over 2,600 fourth grade students from 70 randomly-chosen elementary schools in 5 of the poorest counties in Gansu Province in China’s poor Northwest region. The design called for random assignment of schools to one of two intervention groups, or a control group with no intervention. One intervention provided a daily chewable vitamin, including 5 milligrams of iron. The other mimicked the government policy by providing a daily egg. According to the findings of the paper, in the schools that received the chewable vitamins, hemoglobin (Hb) levels rose by more than 2 g/L (over 0.2 standard deviations). The standardized math test scores of students in these schools also improved significantly. In schools that received eggs, there was no significant effect on Hb levels or math test scores. Overall, these results should encourage China’s Ministry of Education (MOE) to look beyond eggs when tackling nutritional problems related to anemia in an education setting.

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China Economic Review
Authors
Max Kleiman-Weiner
Renfu Luo
Linxiu Zhang
Yaojiang Shi
Alexis Medina
Alexis Medina
Scott Rozelle
Scott Rozelle
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Controversy surrounds the role of the private sector in health service delivery, including primary care and population health services. China’s recent health reforms call for non-discrimination against private providers and emphasize strengthening primary care, but formal contracting-out initiatives remain few, and the associated empirical evidence is very limited. This paper presents a case study of contracting with private providers for urban primary and preventive health services in Shandong Province, China. The case study draws on three primary sources of data: administrative records; a household survey of over 1600 community residents in Weifang and City Y; and a provider survey of over 1000 staff at community health stations (CHS) in both Weifang and City Y. We supplement the quantitative data with one-on-one, in-depth interviews with key informants, including local officials in charge of public health and government finance.

We find significant differences in patient mix: Residents in the communities served by private community health stations are of lower socioeconomic status (more likely to be uninsured and to report poor health), compared to residents in communities served by a government-owned CHS. Analysis of a household survey of 1013 residents shows that they are more willing to do a routine health exam at their neighborhood CHS if they are of low socioeconomic status (as measured either by education or income). Government and private community health stations in Weifang did not statistically differ in their performance on contracted dimensions, after controlling for size and other CHS characteristics. In contrast, the comparison City Y had lower performance and a large gap between public and private providers. We discuss why these patterns arose and what policymakers and residents considered to be the main issues and concerns regarding primary care services.

Keywords:

Private providers; Contracting; Ownership; Primary care; Prevention; China

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Health Economics Review
Authors
Yan Wang (former)
Yan Wang
Karen Eggleston
Karen Eggleston
Zhenjie Yu
Qiong Zhang
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Context  The effect of global health initiatives on population health is uncertain. Between 2003 and 2008, the US President's Emergency Plan for AIDS Relief (PEPFAR), the largest initiative ever devoted to a single disease, operated intensively in 12 African focus countries. The initiative's effect on all-cause adult mortality is unknown.

Objective  To determine whether PEPFAR was associated with relative changes in adult mortality in the countries and districts where it operated most intensively.

Design, Setting, and Participants  Using person-level data from the Demographic and Health Surveys, we conducted cross-country and within-country analyses of adult mortality (annual probability of death per 1000 adults between 15 and 59 years old) and PEPFAR's activities. Across countries, we compared adult mortality in 9 African focus countries (Ethiopia, Kenya, Mozambique, Namibia, Nigeria, Rwanda, Tanzania, Uganda, and Zambia) with 18 African nonfocus countries from 1998 to 2008. We performed subnational analyses using information on PEPFAR's programmatic intensity in Tanzania and Rwanda. We employed difference-in-difference analyses with fixed effects for countries and years as well as personal and time-varying area characteristics.

Main Outcome Measure  Adult all-cause mortality.

Results  We analyzed information on 1 538 612 adults, including 60 303 deaths, from 41 surveys in 27 countries, 9 of them focus countries. In 2003, age-adjusted adult mortality was 8.3 per 1000 adults in the focus countries (95% CI, 8.0-8.6) and 8.5 per 1000 adults (95% CI, 8.3-8.7) in the nonfocus countries. In 2008, mortality was 4.1 per 1000 (95% CI, 3.6-4.6) in the focus countries and 6.9 per 1000 (95% CI, 6.3-7.5) in the nonfocus countries. The adjusted odds ratio of mortality among adults living in focus countries compared with nonfocus countries between 2004 and 2008 was 0.84 (95% CI, 0.72-0.99; P = .03). Within Tanzania and Rwanda, the adjusted odds ratio of mortality for adults living in districts where PEPFAR operated more intensively was 0.83 (95% CI, 0.72-0.97; P = .02) and 0.75 (95% CI, 0.56-0.99; P = .04), respectively, compared with districts where it operated less intensively.

Conclusions  Between 2004 and 2008, all-cause adult mortality declined more in PEPFAR focus countries relative to nonfocus countries. It was not possible to determine whether PEPFAR was associated with mortality effects separate from reductions in HIV-specific deaths.

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Journal of the American Medical Association
Authors
Eran Bendavid
Eran Bendavid
Charles Holmes
Jay Bhattacharya
Jay Bhattacharya
Grant Miller
Grant Miller
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Objective: To assess the health literacy and numeracy skills of Spanish-speaking parents of young children and to validate a new Spanish language health literacy assessment for parents, the Spanish Parental Health Literacy Activities Test (PHLAT Spanish). Methods: Cross-sectional study of Spanish-speaking caregivers of young children (<30 months) enrolled at primary care clinics in 4 academic medical centers. Caregivers were administered the 10-item PHLAT in addition to validated tests of health literacy (S-TOFHLA) and numeracy (WRAT-3 Arithmetic). Psychometric analysis was used to examine item characteristics of the PHLAT-10 Spanish, to assess its correlation with sociodemographics and performance on literacy/numeracy assessments, and to generate a shorter 8-item scale (PHLAT-8). Results: Of 176 caregivers, 77% had adequate health literacy (S-TOFHLA), whereas only 0.6% had 9th grade or greater numeracy skills. Mean PHLAT-10 score was 41.6% (SD 21.1). Fewer than one-half (45.5%) were able to read a liquid antibiotic prescription label and demonstrate how much medication to administer within an oral syringe. Less than one-third (31.8%) were able to interpret a food label to determine whether it met WIC (Special supplemental nutrition program for Women, Infants, and Children) guidelines. Greater PHLAT-10 score was associated with greater years of education (r = 0.49), S-TOFHLA (r = 0.53), and WRAT-3 (r = 0.55) scores (P < .001). Internal reliability was good (Kuder-Richardson coefficient of reliability; KR-20 = 0.61). An 8-item scale was highly correlated with the full 10-item scale (r = 0.97, P < .001), with comparable internal reliability (KR-20 = 0.64). Conclusions: Many Spanish-speaking parents have difficulty performing health-related literacy and numeracy tasks. The Spanish PHLAT demonstrates good psychometric characteristics and may be useful for identifying parents who would benefit from receiving low-literacy child health information. Copyright © 2012 by Academic Pediatric Association.

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Academic Pediatrics
Authors
Yin, H.S.
Lee M. Sanders
Lee M. Sanders
Rothman, R.L.
Mendelsohn, A.L.
Dreyer, B.P.
White, R.O.
Finkle, J.P.
Prendes, S.
Perrin, E.M.
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In this paper we report the results of a randomized controlled trial designed to measure the impact of a parental training program on the nutritional status of primary school students in rural Shaanxi Province, in Northwest China. Using hemoglobin (Hb) levels as the outcome variable, we first measure the overall impact of a nutritional training program, then measure the impact separately by gender. We use both descriptive and multivariate analyses.

The results for the descriptive and econometric results were robust and consistent with the literature. Overall, we find no impact on students’ Hb levels when we trained their parents about undernutrition and anemia. In both the descriptive and multivariate results, there was no difference in the change of Hb levels between control and treatment students. Parents in the treatment group did learn more about anemia than parents in the control group, but this increased knowledge did not lead to sharp changes in behavior, in general. We did find, however, that there was a measurable impact of parental training on the Hb levels of female students. In both the descriptive and econometric results we found that the Hb levels of female students rose more than that of male students, and that this difference was statistically significant. We conjecture that the parents of female students may have recognized from the training that they were not providing their daughters with sufficient nutrition. Our data show that parents in the treatment group responded by increasing the daily provision of meat, fish, eggs and beans, relative to parents of girls in the control group.

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Journal Articles
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China Agricultural Economic Review
Authors
Yaojiang Shi
Fang Chang
Xiaoqing Su
Renfu Luo
Linxiu Zhang
Scott Rozelle
Scott Rozelle
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