How Food Consumption Varies in Rich and Poor Countries

The American Journal of Agricultural Economics recently released an interesting paper entitled by Kenneth Clements and Jiawei Si.  Using previously unpublished data from the World Bank on consumption of 31 different food items in 150 countries, the paper has a lot of fascinating details about how food consumption differs in rich and poor countries, where find "substantial differences in per capita incomes lead to sharp, almost extreme, differences in consumption patterns."  I took some of the data in their paper to construct the graphs below.

First, their data strongly support "Engel's Law" in that the share of income spent on food declines the wealthier the country.  One of the poorest countries in their sample is the Central African Republic where consumers spend 64% of their income on food; in the richest countries like the U.S. and Bermuda, consumers spend less than 10% of their income on food.


The paper reviews some interesting details about how food expenditures differ across countries.  For example, the figures below show how consumers' food budgets are allocated in the richest quarter of countries as compared to countries in the lowest quartile of income.  I've drawn the pie charts so that they are roughly proportional to the quantity of food consumed in each country grouping.  Consumers in the lowest income countries consume about 77% less food than consumers in the highest income countries.  So, compared to richer consumers, poorer consumers are not only consuming a larger share of their income on food, they're eating less food.  

The other thing revealed in the graphs below is that richer consumers have greater diversity in their diets than poor consumers.  Just to give one example, Clements and Si estimate that consumers in richer countries spend only 3.3% of their food budget on rice and other cereals and flours (this is part of the 14% for bread, rice, and cereals in the figure below), but consumers in poorer countries spend 23.7% on rice and other cereals and flours (this is part of the 29% for bread, rice, and cereals). Thus, poorer consumers diets are more concentrated in rice and cereals and is less diversified in other foodstuffs.  Of course dietary diversity is a key measure of the nutritional quality of consumers' diets.  Clements and Si estimate that the diets of the rich are 3.5 times more diverse than the poor's.  

They write:

A more varied diet brings nutritional advantages and for most, diet diversity is valued in and of itself, if not an essential part of their life. As the diversity of the diet tends to increase with income, not only does the food share fall with higher incomes, spending is also likely to be spread more evenly over foodstuffs, providing a more balanced diet. Relatedly, higher incomes bring a shift away from lower-quality items, towards more expensive, possibly more tasty and nutritious foods.

Clements and Si find other interesting consumption patterns, such as the following::

we find considerable differences between pairs of countries. Higher incomes bring higher-quality food, but the overall elasticity is small: enhanced food quality can only be achieved with substantially higher incomes. Furthermore, better-quality food comes at a higher price, but interestingly, this cost, relative to lower-quality food, falls as we move from poorer to richer countries. The structure of food prices is thus regressive in its impact on the global distribution of real income. This effect is modest, however.

The whole thing is here.