Hi, In 'media and moral outrage' I saw that statistics pointing to declining per capita availability of foodgrains was questioned.
The source of that statistics is Utsa Patnaik - http://ideaswebsite.org/featart/apr2004/Republic_Hunger.pdf. She discusses the fallacy in the 'diversified basket' argument - availability includes direct consumption and indirect use (for livestock etc). So, availability always rises when incomes rise. If availability falls, as it is the case with India, it signifies there's acute distress. Quoting from the paper linked here: "The perception of the government and of the majority of academics, is however very different from that expressed above: they interpret the development as nothing out of the ordinary and many indeed even see it as a positive development, indicating a voluntarily chosen, more diversified basket of consumption by all segments of the population including the poor. When as a ground reality, the incidence of hunger rises, a ‘denial mode’ amongst those who govern and also amongst those who are associated with making or influencing policy during the period concerned, is common and is to be expected. But in the present case the divergence between the reality of increasing hunger, and the prevalent bland justifications of the phenomenon as a positive one, is so stark and so striking, that this divergence itself perhaps requires a theoretical explanation. Never before in the independent history of our country have we seen the kind of wholesale denial of a negative trend, and of its packaging and presentation as a positive development, as we are seeing at present. Moreover, the packaging and the justifications are not being put forward only by the right –wing political class which through its policy measures, is responsible for the present debacle. That the present government and ruling class in this country should seek to sanitize and justify the deeply anti-humanist and negative trend of increasing hunger, is to be expected. What is disturbing is that a large number of hitherto liberal academics are also advancing these justifications on the basis of various theories which are, needless to say, quite fallacious. ... "Often the argument is heard that since per capita income is rising it is to be expected that people should consume less cereals and pulses which become inferior goods, and consume more high-value foods: in short, people would diversify their diets. A falling share of grains in the consumer budget as income rises is known as Engel’s Law. So, it is argued, there is nothing wrong if we see falling availability/absorption of foodgrains per head. This is a total misconception regarding Engel’s Law and it seems to have contributed to the incorrect official explanations of large stocks as arising from ‘overproduction’, discussed a little later. It is a misconception because Engel was referring to the fall in the share of food expenditure for the direct consumption of grains as income rises, and not to the total absorption of grains which includes both direct use as well as indirect use as feed for livestock (to produce milk, eggs, meat and so on), and as industrial raw material. The absorption of foodgrains per capita is always found to rise, not fall, as the consumer’s average income rises. The figures of availability we have given, as indeed the official figures of availability, refer to absorption of grain for all purposes. (Note that availability figures do not require any consumption data but are calculated directly from output data, which is the hardest data we have, and this is adjusted only for trade and for stocks, so by definition it has to meet all possible final uses). Availability of foodgrains thus includes not only direct consumption (as roti, boiled rice and so on) but also the part converted to animal products by being used as commercial feedgrains, and at present a part of these animal products are exported. (The conversion coefficients are quite high, for example a kilo of mutton can require 3-4 kilos of feedgrain to produce). Availability also includes the part of grain converted to industrial products like starch and alcohol, and into processed foods like cornflakes and noodles with an urban market. The availability, or absorption of foodgrains per head, because it is for all uses, always rises as a nation’s per capita income rises. This is a very well known fact and is supported by an extensive literature on the responsiveness of demand for cereals to rising incomes, and by the FAO food balance sheets which give data over time for output, trade and stocks by individual crops, and cover virtually every country." ... "The recent trend in this country of sharply declining foodgrains absorption per head while average per capita income has been rising, is thus highly abnormal, not only in the light of international experience but also in comparison with our own past experience – we have always seen rising grain absorption per capita as average incomes rose in the past in India. Between 1950 and 1991 per capita absorption rose slowly from 152 kg to 177 kg as per capita incomes rose. As earlier observed these gains of four decades have been wiped out in a single decade of economic reform, and while availability fell by 3 kg per head in the seven years up to 1998, over eight-tenths of the total fall, namely a fall of 19 kg, has taken place in the mere five years of NDA rule (from 174 kg average for the three years ending in 1998 to 155 kg average for the three years ending in 2002-03)" .. "What lies behind the decline in absorption of foodgrains? The massive decline at present compared to 1998, is the result of an unprecedented decline in purchasing power in rural areas following directly from a number of deflationary policies at the macroeconomic level, combined with international price declines for the larger volumes of export crops produced in India following trade liberalization. Both deflationary policies and opening up to trade are integral to neo-liberal economic reforms. This has resulted in a deflation of effective demand as far as the mass of the rural population is concerned." Thanks, Sruthi
