Instructions: This problem set asks you to apply what you've learned about nutrition targeting to understand some real-world issues. Please wr-ite answers that are short and to the point. Some of the questions can be answered by drawing a graph. Please make sure you add an explanation of any image or graph. (It may be easiest to draw out graphs by hand and scan/screenshot it to submit it.)

Questions:

1. In West Africa most people consume salt in the form of rock salt from the many salt mines in the area (500 years ago this was the region's most lucrative export). That means they don't consume regular table salt that can be fortified with iodine to prevent goiter. Goiter is a major health problem in the region with as much as 28% of the population in Africa suffering from it and the problem is worse in rural areas.

a. If you wanted to fortify a food to address the goiter problem, what kind of food would you want to choose? What are the important criteria you would use for choosing that food.

b. Nestle makes a very popular spice addition that most urban cooks in West Africa include in their sauces, the Maggi CubeLinks to an external site., which contains iodized salt. How does this d-o at targeting the goiter problem in West Africa? Is there a policy you could conceive of to help make it more effective?

2. In 2023 global rice prices spiked to an 11 year high, rising 21% over the 2022 levels. Rice is a staple of the Senegalese diet for rich and poor in both rural and urban areas, with the average Senegalese eating close to 200 pounds of rice per year. In terms of income elasticity, rice is a normal good in Senegal. The last time rice prices spiked there were food riots in Senegal. Over 70% of the rice consumed by the Senegalese is imported, so the world price of rice sets the local Senegalese price. a. The government of Senegal is considering artificially lowering the price of rice for consumers by setting a maximum price for rice that is at the 2022 price level. Draw out how this would affect supply and demand in the Senegalese rice market. What are the costs and benefits of setting a maximum price for rice? Note that the world price of rice is determined by the amount of exports from Thailand, Vietnam, the US and not affected by Senegalese policy. What would happen to overall rice consumption?

b. How would the price ceiling on rice d-o at targeting for maintaining or improving the nutrition of various sectors of Senegalese society? Who would benefit the most or the least?

c. The Senegalese Minister of Agriculture proposes an alternative plan: increase domestic production of rice with a new rice seed variety that produces 20% more rice for the same land and labor. Assuming all Senegalese rice producers adopt this new seed, draw the new supply curve and new equilibrium between supply and demand for rice. Is it possible that the new rice seed lowers the rice price to same leve as the price ceiling? Explain your answer.

Ref:

**Lecture Transcript: AAE 350 World Hunger and Malnutrition**

**Topic: Production Gap Policies and Supply Curve Dynamics**

**Introduction:**

- Today's lecture focuses on production gap policies aimed at increasing food production and addressing issues in the bread aisle.

- We will correct misconceptions from previous sections regarding subsidies and delve into the economics behind them.

- The session will explore various factors affecting supply curves, including price ceilings, subsidies, and technological advancements.

- A case study on the Malawi fertilizer subsidy program will be analyzed to understand its impact on agricultural production and poverty reduction.

- Feedback on the course structure and content is encouraged at the end of the session.

**Key Learning Objectives:**

1. Understanding government subsidies and price ceilings.

2. Exploring the role of subsidies in altering supply curves.

3. Analyzing the effectiveness of subsidies on price and quantity.

4. Case study: Malawi fertilizer subsidy program.

**Main Lecture Points:**

1. **Introduction to Production Gap Policies:**

- Definition: Policies aimed at increasing overall food production.

- Focus on correcting misconceptions regarding subsidies and their implementation.

2. **Supply Curve Dynamics:**

- Factors influencing supply curves: price ceilings, subsidies, and technological advancements.

- Discussion on shifting supply curves and its implications on market equilibrium.

3. **Government Subsidies and Price Ceilings:**

- Explanation of how government subsidies crea-te artificially low prices.

- Illustration of the need to induce producers to meet excess demand through higher prices.

4. **Subsidies and Supply Curve Movement:**

- Subsidies act as incentives for producers to increase output.

- Analysis of the subsidized price and its impact on producer behavior.

5. **Case Study: Malawi Fertilizer Subsidy Program:**

- Overview of the program aimed at increasing agricultural production and reducing poverty.

- Examination of the use of subsidized seeds and fertilizer to achieve program objectives.

**Conclusion:**

- Emphasis on the importance of understanding production gap policies in addressing world hunger and malnutrition.

- Encouragement for feedback on the course structure and content for continuous improvement.

- Reminder of available resources for further exploration, including case studies and academic literature.

**Additional Information:**

- Availability of fonio products at local markets.

- Recommendation for exploring adventurous food options like Moringa.

- Clarification on the concept of government subsidies and their role in market dynamics.

**Lecture Transcript: AAE 350 World Hunger and Malnutrition**

**Topic: Analysis of Subsidy Policies and Agricultural Interventions**

**Introduction:**

- In today's session, we will delve into the analysis of subsidy policies and various agricultural interventions aimed at addressing food security and poverty alleviation.

- We will explore scenarios of subsidies, price ceilings, and technological advancements in the context of agricultural markets.

- Additionally, we will discuss a case study on the Malawi fertilizer subsidy program to understand its implementation, challenges, and impact on agricultural production and poverty reduction.

**Key Learning Objectives:**

1. Understanding the economic implications of subsidy policies and price ceilings.

2. Analyzing the role of agricultural interventions in addressing food security and poverty.

3. Examining the implementation challenges and effectiveness of subsidy programs.

4. Case study: Malawi fertilizer subsidy program - analyzing its impact on agricultural production and poverty alleviation.

**Main Lecture Points:**

1. **Analysis of Subsidy Policies:**

- Explanation of the cost implications of subsidies and the importance of effective subsidy design.

- Comparison between subsidy policies and price ceilings in agricultural markets.

2. **Effects of Price Ceilings without Subsidies:**

- Discussion on scenarios where price ceilings are implemented without subsidizing producers.

- Analysis of potential supply shortages and excess demand in controlled food markets.

3. **Subsidies and Supply Curve Dynamics:**

- Illustration of how subsidies can incentivize increased production and alter supply curves.

- Examples of government interventions through subsidized prices to influence market outcomes.

4. **Case Study: Malawi Fertilizer Subsidy Program:**

- Overview of the Malawi fertilizer subsidy program initiated in response to food insecurity and poverty.

- Examination of the distribution process, targeting mechanisms, and challenges in implementation.

- Evaluation of the program's impact on agricultural production, household incomes, and food security.

5. **Technological Advancements in Agriculture:**

- Analysis of how new agricultural technologies can lower production costs and increase yields.

- Exploration of the role of mechanization, irrigation, and improved seed varieties in expanding food production.

- Discussion on the implications of technological advancements on market equilibrium and consumer welfare.

6. **Reducing Input Costs and Improving Infrastructure:**

- Explanation of strategies to reduce input costs, such as subsidies for agricultural inputs.

- Examination of the role of improved infrastructure, including transportation and irrigation, in enhancing agricultural productivity.

**Conclusion:**

- Emphasis on the importance of effective subsidy design and implementation in agricultural markets.

- Recognition of the challenges and trade-offs involved in subsidy programs, particularly in targeting and distribution.

- Acknowledgment of the role of technological advancements and infrastructure development in enhancing food production and addressing food insecurity.

- Encouragement for critical evaluation and feedback on subsidy policies and agricultural interventions for continuous improvement.

**Additional Information:**

- Discussion on the allocation of resources and budgetary considerations for subsidy programs.

- Reflection on the complexities of poverty alleviation strategies and the need for adaptive policy responses.

- Announcement of upcoming topics, including agricultural research and development and diversification of crop production for improved nutrition and health.

**End of Transcript**

This transcript provides a comprehensive overview of the lecture content, including detailed explanations of subsidy policies, analysis of case studies, and implications for agricultural markets and food security.

### Lecture Transcript: AAE 350 - World Hunger and Malnutrition

**Topic: Fortification and Nutrition Interventions**

**Introduction:**

- Today's lecture focuses on fortification and its role in nutrition interventions.

- Emphasis on targeting specific nutrients and understanding the basics of fortification.

**Policies Affecting Markets:**

- Overview of policies to affect food supply.

- Examples: subsidization, income elasticity targeting.

- Importance of targeting foods consumed by poor populations for efficient nutrition programs.

**Fortification Basics:**

- Need for micronutrients alongside increasing food supply.

- Fortification allows targeting of specific nutrients lacking in diets.

- Examples of fortified foods: salt (iodine), dairy (vitamin D, A, calcium), breakfast cereals, fruit juices, eggs (omega-3).

- Breakfast foods often chosen for fortification due to widespread consumption.

**Fortification Guidelines:**

1. Fortify when nutrient intake without fortification is below desirable levels for a significant population.

2. Choose foods consumed in significant quantities by the target population.

3. Avoid creating imbalances of essential nutrients.

4. Ensure nutrient stability and availability under storage conditions.

5. Consider physiological availability for effective absorption.

6. Align fortification choices with optimal nutrient absorption.

**Conclusion:**

- Fortification offers a targeted approach to address nutrient deficiencies alongside broader food supply policies.

- Understanding guidelines and considerations is essential for effective fortification programs.

This lecture provides insights into fortification strategies, emphasizing the importance of targeted interventions in addressing malnutrition and improving public health outcomes.

### Lecture Transcript: AAE 350 - World Hunger and Malnutrition

**Topic: Fortification and Vitamin D Fortification**

**Fortification and Targeting:**

- Fortification aims to provide specific micronutrients to populations at risk of deficiency.

- Challenges include avoiding excess intake and ensuring effective targeting.

- Guidelines emphasize targeting those at greatest risk of deficiency without causing excessive intake.

**Fortified Foods Selection Criteria:**

1. Foods consumed in significant quantities by the target population.

2. Staple foods popular in local culture.

3. Limited substitutes or fortified substitutes available.

4. Relatively low price elasticity of demand.

5. Adequate supply and income elasticity sense.

6. Preferably normal goods for fortification targeting.

**Vitamin D Fortification:**

- Historical context: Rickets, a widespread disease in the early 20th century due to vitamin D deficiency.

- Professor Harry Steenbock's discovery of irradiation process for fortifying foods with vitamin D.

- Proposal and implementation of fortified milk in the US, led by Steenbock.

- Rapid expansion of vitamin D fortification in the US dairy industry by 1933.

- Effects: Almost complete eradication of rickets within a decade.

- Health and educational outcomes: Vitamin D fortification linked to improved school attendance and outcomes, especially among African American children in areas with below-average sunlight.

- Expansion to other foods: Bread industry voluntary fortification of white bread, known as "enriched" white bread.

**Factors Contributing to Success:**

1. Large portion of target population consumed milk regularly.

2. No legal mandates facilitated voluntary fortification.

3. Market demand and price premiums for fortified products.

4. Public health recommendations and interest in vitamins influenced consumer behavior.

5. Low-cost implementation contributed to widespread adoption.

**Conclusion:**

- Vitamin D fortification exemplifies successful targeting of a specific nutrient to address a widespread deficiency.

- Collaboration between research institutions, industries, and public health agencies crucial for effective implementation.

- Next lecture: Production gap policies and strategies to increase food diversity.

**Reading Assignment:**

- Chapter 19 on production gap policies recommended for further understanding of food supply interventions.

This lecture provides insights into the history, implementation, and effects of vitamin D fortification, highlighting the importance of targeted nutrition interventions in combating malnutrition and improving public health outcomes.

### Lecture Transcript: AAE 350 - World Hunger and Malnutrition

**Topic: Price and Supply Policies, and Artificially Low Prices**

**Introduction:**

- Today's lecture focuses on price and supply policies, including artificially low prices set by governments.

- Discussion will include the impact of increasing food supply and interventions such as food aid.

- Understanding supply and demand dynamics and elasticities is crucial for effective policy implementation.

**Review of Food Aid:**

- Food aid involves international concessional flows of food or cash to address food insecurity.

- Food aid programs aim to provide short-term humanitarian assistance and long-term safety nets.

- Local purchase of food aids in supporting regional markets and reduces reliance on imports.

**Changing Food Supply:**

- Increasing food supply can involve various interventions, including improving agricultural technologies and market interventions.

- Today's focus: Setting artificially low prices for food to influence consumption and affordability.

**Artificially Low Prices: The Baguette in France:**

- Historical context: French Revolution highlighted riots over high bread prices, leading to government intervention.

- In 1789, French government set maximum prices for bread to address social unrest.

- Present-day France continues to subsidize bread prices, albeit to a lesser extent.

- Baguette consumption remains high but has declined due to fluctuating subsidies and EU regulations.

**Effects of Artificially Low Prices:**

- Setting an artificially low price for bread distorts the supply and demand equilibrium.

- Lower price stimulates increased demand, leading to higher consumption.

- Suppliers may reduce supply due to lower profitability, requiring government subsidies to maintain supply levels.

- Impact on farmers: Shifts in demand for wheat affect other grain producers and agricultural sectors.

- Government intervention through subsidies ensures market stability but requires significant financial investment.

**Supply and Demand Analysis:**

- Equilibrium price and quantity determined by the intersection of supply and demand curves.

- Government-imposed price below equilibrium leads to excess demand and reduced supply.

- Subsidies compensate suppliers to maintain production levels and stabilize markets.

**Conclusion:**

- Artificially low prices influence consumption patterns and market dynamics.

- Government intervention through subsidies aims to address affordability issues but requires careful management.

- Understanding supply and demand dynamics is essential for effective policy formulation in addressing food security and nutrition challenges.

Today's discussion highlights the complexities of price and supply policies in addressing food security and underscores the importance of considering market dynamics and elasticity in policy design and implementation.

### Lecture Transcript: AAE 350 - World Hunger and Malnutrition

**Topic: Targeting Poverty Programs and Fortification**

**Introduction:**

- Today's lecture delves into the complexities of targeting poverty programs and the effectiveness of fortification in addressing malnutrition.

- We'll discuss the implications of income elasticity, Engels law, and the choice between cash assistance and food aid.

**Artificially Low Prices: Baguette Subsidies in France:**

- Baguette subsidies in France serve as an example of government intervention to address high bread prices.

- Subsidies aim to make bread affordable for all, but lead to increased consumption and necessitate government expenditure.

- Despite potential leakage to wealthier individuals, baguette subsidies ensure broad coverage but may not effectively target the poor.

- Income elasticity helps determine the effectiveness of subsidies for inferior goods favored by low-income populations.

**Income Elasticity and Targeting:**

- Income elasticity measures the change in demand for a good relative to changes in income.

- Inferior goods, with negative income elasticity, are preferred for targeting poverty programs.

- Engels law suggests that as income rises, the share of income spent on food decreases, aiding in poverty targeting.

**Case Study: Red Sorghum in Mali:**

- Red Sorghum food aid during famines in Mali illustrates the importance of income elasticity in targeting.

- Red Sorghum, perceived as inferior, became the primary food source during famines but lost demand once local production resumed.

- The choice between food aid and cash assistance impacts local markets and long-term nutritional outcomes.

**Cash Assistance vs. Food Aid:**

- Cash assistance can be effective in addressing undernutrition by allowing recipients to allocate funds based on individual needs.

- However, the impact varies based on recipient income levels and expenditure patterns.

- The choice between cash assistance and food aid requires consideration of both short-term calorie consumption and long-term nutritional outcomes.

**Fortification and Micronutrient Supplementation:**

- Fortification involves adding essential nutrients to staple foods to address micronutrient deficiencies.

- Vitamin D fortification, for example, can improve bone health and reduce the risk of deficiency-related diseases.

- Fortification programs require careful monitoring to ensure adequate nutrient intake and minimize adverse effects.

**Conclusion:**

- Targeting poverty programs requires a nuanced understanding of income elasticity, expenditure patterns, and nutritional needs.

- Fortification can effectively address micronutrient deficiencies but necessitates ongoing monitoring and evaluation.

- The choice between cash assistance and food aid depends on recipient characteristics and long-term nutritional goals.

Today's lecture underscores the importance of evidence-based policy formulation in addressing world hunger and malnutrition. By understanding the complexities of poverty targeting and the role of fortification in improving nutritional outcomes, policymakers can design interventions that effectively address the diverse needs of vulnerable populations.

### Lecture Transcript: AAE 350 - World Hunger and Malnutrition

**Topic: Food Aid Programs and International Food Security**

**Introduction:**

- Today's lecture focuses on food aid programs, their history, effectiveness, and implications for international food security.

- We'll explore the distinction between domestic food assistance programs like SNAP and international food aid, examining their objectives and challenges.

**Food Assistance Programs vs. Food Aid:**

- Food assistance programs like SNAP provide income support for purchasing food domestically, addressing food insecurity within a country.

- Food aid, on the other hand, involves the international transfer of food, often provided as concessional aid by donor countries to recipient countries in need.

**Historical Context of Food Aid:**

- Food aid originated in the United States in 1954 with Public Law 480 (PL 480), aiming to provide surplus agricultural commodities to countries facing food shortages.

- Initially, the US and Canada accounted for the majority of global food aid flows, but the World Food Program later became a significant player in food aid distribution.

- While emergency humanitarian aid remains a primary focus of food aid, there are also project-based aid programs aimed at supporting development initiatives.

**Types of Food Aid Programs:**

1. **Subsidized Deliveries:** Food is provided to central governments, which may sell it on the local market to generate revenue or stabilize prices.

2. **Project Aid:** Food aid is channeled through non-governmental organizations (NGOs) to support specific development projects or initiatives.

3. **Emergency Humanitarian Delivery:** Food aid is deployed in response to crises or disasters to address immediate food needs in affected regions.

**Challenges and Considerations:**

- Food aid can disrupt local markets by reducing prices, benefiting consumers but potentially harming local producers.

- The effectiveness of food aid in addressing long-term food insecurity and promoting development remains a subject of debate.

- Access to food aid may be hindered by logistical challenges, bureaucratic processes, and political considerations, leading to delays or inadequate distribution.

- There is ongoing debate regarding the relative merits of providing food aid versus cash assistance, considering factors such as efficiency, stigma, and recipient autonomy.

**International Food Security:**

- Food security encompasses availability, access, and utilization of food within a population or region, with international food aid addressing gaps in availability and access.

- Triangular transactions, where food aid is sourced from nearby regions rather than the donor country, have become more common to reduce transportation costs and improve efficiency.

- Despite the significant role of food aid in addressing emergencies and humanitarian crises, it represents a small fraction of global food production and trade.

**Conclusion:**

- Food aid programs play a vital role in addressing food insecurity and humanitarian crises around the world.

- However, challenges such as market disruptions, logistical constraints, and effectiveness concerns underscore the need for ongoing evaluation and improvement of food aid strategies.

- Understanding the complexities of international food security and the nuances of food aid programs is essential for policymakers and stakeholders working to alleviate hunger and malnutrition on a global scale.

Today's lecture highlights the complexities of international food aid programs and their role in addressing food insecurity, underscoring the need for coordinated efforts to ensure effective and sustainable solutions.

**Academic Notes: AAE 350 World Hunger and Malnutrition**

* Lecture Transcript Overview:

- Transition from discussing US Food Assistance Program to international food aid.

- Food stamp program (SNAP) versus food aid in the form of actual food.

- Exploring food security worldwide and the role of US Food Aid program.

- History, problems, and recasting of food aid.

- Learning goals: Understanding food aid programs, donor roles, management issues, and current debates.

* US Food Assistance Program Overview:

- SNAP: Provides money on cards for food purchases.

- Challenges: Eligibility, paperwork, stigma, and bureaucratic delays.

- Targeting based on poverty, but not always efficient due to exclusion or inclusion errors.

- Debates: Cash versus food assistance, impact on nutrition, stigma, and efficiency.

* Food Security Worldwide:

- Three pillars: Availability, access, and utilization.

- International food aid aims to address availability and access.

- Utilization crucial for maintaining household health.

- Challenges in providing effective food aid: Logistics, timing, and efficiency.

* Basics of International Food Aid:

- US leads global food aid, driven by surplus food and political motives.

- Types: Subsidized deliveries, project aid, emergency humanitarian delivery.

- Impact on local markets: Lower prices, benefits consumers, disadvantages producers.

* Food Aid Management Issues:

- Targeting challenges: Inclusion and exclusion errors, lag times.

- Disincentive effects on local production and labor supply.

- Procurement costs: Shipping premiums, inefficiencies, and monetization challenges.

- Justifications for food aid: Short-term humanitarian assistance, safety nets, and aid to chronically poor.

* US Food Aid Programs:

- Composition: In-kind aid, regionally purchased food, food vouchers, cash transfers, local procurement.

- Major recipients: Yemen, Syria, South Sudan, Ethiopia, Somalia.

- Recent changes towards more efficient aid methods, but debates continue in Congress.

* Implications and Debates:

- Political considerations: Lobbying for traditional aid methods versus modernization.

- Balancing farmer support and aid effectiveness.

- Reevaluation of aid purposes: Supporting nutrition versus benefiting US interests.

* Conclusion:

- Continuing debates and policy considerations in international food aid.

- Balancing efficiency, effectiveness, and political interests in aid programs.

- Need for ongoing research and policy reform to address global hunger and malnutrition effectively.

HOW ACHIEVE HIGHER FOOD SUPPLY? Price Supply Price Supply Supply curve with Psubsidized subsidized input P* p* New P* Demand Demand QDemanded* Supplied Quantity Q' New Q' Quantity Price ceilings Supply improvement-> It is not easy to do at allTWO MAIN WAYS OF SUPPLY IMPROVEMENT 1. Expanding supply by Subsidizing inputs 2. Expanding supply with new technologies (Decreasing costs) (Increase efficiency) Supply and Demand Curves: w/ new technology EXPANDING SUPPLY WITH A SUBSIDIZED Price Supply INPUTS (E.G. Supply curve with subsidized input FERTILIZER) 1. Subsidized input shifts out the supply P* curve in a parallel fashion 2. Generates new supply and demand New P* equilibrium 3. Prices go down and quantities consumed go up. 1. Consumers unambiguously better Demand off, get more at a lower price 2. Farmers/ producers may or may not New Q* Quantity be better off depending on elasticities 3. Government bears the cost of the subsidySupply and Demand Curves: w/ new technology EXPANDING Price Supply SUPPLY WITH A Supply curve with new technology NEW TECHNOLOGY P* 1. New technology shifts out the supply curve New P* 2. Generates new supply and demand equilibrium 3. Prices go down and quantities Demand consumed go up. a) Consumers: Better off (more at New Q* Quantity lower price) b) Farmers /Producers: Depends on elasticitiesImpact of New Technology on Rice Supply and Demand 200 Demand Original Supply 175 New Supply with Technology 150 125 Price of Rice 100 75 50 25 0 0 20 40 60 80 100 Quantity of Rice