Hierarchy of Food Needs

“How would it look to apply the principles of Maslow’s Hierarchy of Needs to food management?”

That's the opening sentence by Ellyn Satter in a 2007 article in the Journal of Nutrition Education and Behavior.  She writes:

“Abraham Maslow arranged basic needs in order of sequential importance to the individual and taught that needs at each level must be satisfied before the individual can become aware of and address the next level of need. From the foundation through the apex on Maslow’s pyramid-shaped Hierarchy of Needs, they are: (1) physiological needs: air, water, food, shelter, sleep, sex; (2) safety, security and order; (3) social affection: love and belongingness; (4) esteem, status: self-esteem and esteem by others; and (5) self-actualization: being all the individual can be.”

She then proposes (without any data or evidence I might add), the following hierarchy of food needs.

Satter argues this hierarchy is important to understand for nutrition educators who should: 

“join with individuals right where they are. For those whose most pressing concern is getting
enough to eat, help them choose dependably filling and satisfying food. Address energy inadequacy by endorsing adding fat—butter, oil, or salad dressing—to vegetables and grains and using whole milk. Point out the nutritional value of preferred food items, and suggest additional low-cost food items that are both energy dense and nutritious. But avoid prioritizing food selection based nutritional considerations alone. Doing so is realistic only for people who are functioning at the apex of Satter’s Hierarchy of Food Needs.”

To what extent is this "model" true?  A few weeks ago, I compared the food values for the rich and poor, which provided some support.  But, even that data suggests taste, safety, price, and nutrition are top four food values (out of 12 total values) for both low and high income.  The ranking for high income is taste, nutrition, safety, and price and for low income is price, taste, safety, and nutrition; factors like fairness, novelty, and origin were ranked last for both high and low income groups.  It would be interesting to see studies comparing income elasticities of demand for foods that fit the above criteria.  However, the above model doesn't necessarily suggest income is the main driver - only that one has to meet a "lower" need, via whatever means, before another "higher" need is met.    

Akin Adesina

One of the pleasures of being a department head is getting to celebrate the successes and accomplishments of students, faculty, and alumni.  Last week, Akinwumi (Akin) Adesina, an MS and PhD graduate of the Department of Agricultural Economics at Purdue University, was awarded the World Food Prize, and I had the opportunity to engage with him a bit at events prior to the ceremony and yesterday when he returned to campus for a visit.  

To say I was impressed by Akin would be an understatement.  He is smart, passionate, and gregarious, which helps explain how he became president of the African Development bank after previously serving as Nigerian Agriculture Minister.  In, 2013 he was Forbes man of the year in Africa, and probably more telling than anything else, he’s giving away the $250,000 prize money from the World Food Prize to create a fund to promote African youth in agriculture.

Akin's visit caused me to reflect on the ability of good economic work to substantially impact people's lives and on the state of the academic economics profession generally.  He told a story about how, early on in his career, after witnessing grain bins in a farm village overflowing with a new, high yielding sorghum variety, he realized that food security was more than just agronomy: without developing markets to sell higher-yielding crops varieties, the benefits would not be widely distributed and enjoyed.  The market and economic approach to helping solve African food security and poverty problems have become signatures of Akin's career.  Among Akin's many accomplishments that rely on this economic-based approach, I'll mention two (see here for more details). 

First, he noticed that several promising technologies and crop varieties already existed but were not being adopted because farmers lacked the resources to acquire the new technologies that could substantially increase yield.  By promising to partially backstop loans (initially via a fund from the Rockefeller Foundation), he encouraged banks to make capital available to farmers.  Despite banks' initial reluctance to loan to farmers, there were very low loan failure rates, and the program was successful and was scaled up, eventually leveraging hundreds of millions of dollars that flowed to the African agricultural sector to increase agricultural productivity.  This is one of several efforts he and his team are working on to reduce the risk of investing in African agriculture.

Second, as Minster of Agriculture in Nigeria, he aimed to tackle the problem under-use of fertilizer in the country.  Yes, in many parts of the developed world, there are problems associated with over-use of fertilizer, but in Africa the problem is just the reverse.  The problem is that for decades fertilizer had been purchased by the government and then was distributed to farmers.  The program was rife with corruption and only well-connected farmers had access to fertilizer.  Akin initiated a disruptive technological solution to the problem: fertilizer subsidies were instead directly distributed to farmers via their mobile phones.  Within a few months, decades of corruption were overturned and fertilizer became much more accessible.  As a result, crop yields increased significantly.  His efforts earned him the nickname: "the farmers' minister."  

One of the things Akin mentioned several times over the past few days is that he aims for Africans to see farming as a business.  This runs so counter to our developed-world pastoral ideals about what farming should be.  Yet, we can afford to harbor these romantic notions precisely because the farmers in the US became much more business-like over the past century.  Another of Akin's goals is, in his words, to make agriculture sexy.  Through a variety of efforts, he's encouraging what he calls "agri-preneurs", to prompt investment in agriculture.

It is useful to contrast this body of work with what we typically do in academics.  In academic economics, focus has shifted in recent decades toward research problems where there can be strong credible claims about identification and causal relationships (i.e., are we sure X is causing Y or are the two just correlated?).  In development economics, the shift has led to more randomized controlled trials (RCTs) to evaluate effectiveness of interventions. These changes have been good for the profession and I fully support the shift.  However, Akin’s visit also made me a bit more sympathetic to some of the critics (including prominent figures such as Angus Deaton and James Heckman) of these methodological changes.  The concern is that the “randomistas”, as they are sometimes derogatorily called, miss the “big questions” and the “important issues”, focusing instead only on those problems and data sets that lend themselves to making strong causal claims that can be published in top academic journals.  My view is that the economics profession is big enough to do both: we can pursue the big questions while simultaneously thinking about creative ways to uncover causal mechanisms.  Akin’s work is really inspirational in showing how good economic policy based on solid economic theory (i.e. the presumed causal mechanisms) can help improve the lives of millions of people. 

Agricultural Productivity and Food Security

There are two competing narratives about the future of food.  One is that the world population is growing and we need to increase agricultural productivity to "feed the world".  The other argument is that we don't need to produce more food - we already produce enough food to feed the world and our problems are really more about distribution than production.  Folks in the later camp often advocate for lower-productivity forms of agriculture that they perceive to have health or environmental benefits.  Like most arguments, there are elements of truth to both sides.  

As a proponent of improved agricultural productivity (which, I've argued is the key metric to improved sustainability), it bears asking: if a country's agriculture is more productive are it's people better fed?  

To delve into this question, I combined two data sets.  The first is a measure of a country's agricultural productivity from the World Bank in the year 2015.  In particular, they calculate for a large number of countries, the agricultural value added per worker.  In their words:

“Agriculture value added per worker is a measure of agricultural productivity. Value added in agriculture measures the output of the agricultural sector (ISIC divisions 1-5) less the value of intermediate inputs. Agriculture comprises value added from forestry, hunting, and fishing as well as cultivation of crops and livestock production. Data are in constant 2010 U.S. dollars.”

By this measure, the most productive countries are Slovenia, Singapore, Norway, France, Lebanon, Canada, New Zealand, Finland, and the United States, each of which produced more than $80,000 in agricultural value per worker in 2015 (measured in 2010 dollars).  Places like Malawi, Congo, Mozambique, Gambia, and Madagascar had some of the lowest productivity, with agricultural value added at around $400/worker or less.

Secondly, I collected data from the Global Food Security Index, a project ran by The Economist and supported by DuPont.  In their words:

“The Global Food Security Index considers the core issues of affordability, availability, and quality across a set of 113 countries. The index is a dynamic quantitative and qualitative benchmarking model, constructed from 28 unique indicators, that measures these drivers of food security across both developing and developed countries.

This index is the first to examine food security comprehensively across the three internationally established dimensions. Moreover, the study looks beyond hunger to the underlying factors affecting food insecurity. This year the GFSI includes an adjustment factor on natural resources and resilience. This new category assesses a country’s exposure to the impacts of a changing climate; its susceptibility to natural resource risks; and how the country is adapting to these risks.”

From this project, I pulled each country's overall food insecurity score (calculated in September 2017), which took on the values of around 30 for countries like the Congo, Madagascar, Chad, and Malawi, and was above 80 for countries like the U.S., the U.K., Ireland, and France.  Although they call this a measure of food insecurity, a higher score actually means a country is more food secure.   

So, what did I find?

There is a strong positive relationship between a country's agricultural productivity and how well it's people are fed and how food secure they are.  Fitting a logarithmic relationship between the two variables suggests that 82% of the variation in the food security scores across countries is explained by differences in agricultural productivity.  

Now, there are a lot of other things going on here as agricultural productivity is likely correlated with and affected by other factors affecting a country's general productivity and development, but the above figure might give pause to those arguing for lower productivity forms of agriculture. 

At the top end, the curve suggests one can sacrifice some productivity with only a small reduction in food security (going from $80,000/worker to $40,000/worker) reduces the food security scale from about 80 to 75.  But, at the lower end, going from, say, $20,000 in agricultural output per worker to $10,000/worker reduces the food security scale from about 70 to 60, and reducing productivity another $10,000 lowers the food security scale down to the 30s.  

Inequalities of Fat Taxes and Thin Subsidies

I was excited to see The Economist ran an article on my paper with Laurent Muller, Anne Lacroix, and Bernard Ruffieux, which appeared in the Economic Journal.  In typical Economist fashion, they didn't mention us by name, but here's their summary of our findings:

“The study found that the taxes and subsidies actually widened health and fiscal inequalities. Fat taxes meant the women on lower incomes paid disproportionately more for food—their habits changed less. They preferred to buy food they liked rather than what made nutritional sense. Taxing the food they eat most made the poor poorer.

Subsidies encouraged all income groups to buy more fruit and vegetables. But those on higher incomes proved more responsive and so benefited most. Interestingly, richer folk were also more likely to buy the subsidised healthy food and then spend the savings they had accrued on yet more healthy food. But poorer women, if they responded to lower prices, often used the money saved to buy unhealthy items or something else entirely. Once the nutritional price policies were applied, the average share of budget spent on healthy food actually increased for the better-off. ”

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.