|Dr Tareq Abu-El-Haj
Food Security Policy Impact Analysis: The Econometrics of Cash and Food Assistance Cost Effectiveness
Cathal O’Donoghue and Franziska Gassmann
This dissertation explores the relative merits of cash and food transfers in the context of national safety nets as well as international humanitarian and international aid by addressing questions such as the problem of valuing food transfers and subsidies, understanding the implications of different consumption responses due to alternative transfer modalities and estimating food demand parameters in the presence of subsidies and rationing. The dissertation estimates the parameters of a complete food demand system for Iraq and finds consistent evidence in published empirical literature suggesting that the demand for food due to food assistance is unit elastic. This is further confirmed empirically for Iraq where the demand for food due to food assistance is also approximately unit elastic nationally and for various sub-national groupings and income groups. This finding is utilized to develop a stylized nutritional cost effectiveness analysis approach specific to cash and food vouchers. The dissertation provides evidence on the food security and welfare costs and benefits of replacing food consumption subsidies in Iraq with cash or food voucher transfers and finds that food vouchers are more cost effective than cash transfers in ensuring food consumption. The dissertation also finds that the cost of replacing universal food consumption subsidies with a targeted cash or food voucher transfer that fully mitigates the effects of reform is higher than the cost of the original subsidy.