In-Kind Food Transfers - II

Part-II reports the impact of in-kind food transfers on nutritional intake as measured by calories. Econometric analysis using a simple calorie demand function confirms the significance of variables relating to public distribution system access, controlling for other covariates, in its contribution to calorie intake. Results also suggest that the calorie-elasticity of PDS transfers is twice as large compared to additional out-of-pocket income equal to the cash equivalent of PDS transfers. These are also confirmed by non-parametric analysis of calorie intake of various consumer groups. Although preliminary, these results suggest caution in advocating cash transfers as substitute of in-kind transfers. Finally, the paper evaluates concerns about the financial implications of the minimum support price-PDS system in light of the recently enacted National Food Security Act.