Thursday, January 26, 2012

Assignment #1

Chapter 2 of Poor Economics looks at the relationship between malnutrition and the ability to perform at a job and be a productive worker.  The chapter focuses on poor countries which often have trouble getting as many nutrients as they need in their diets.  The topics they discuss were aroused by the announcement made in 2009 by the UN Food and Agriculture Organization which said that there were more than a billion people in the world suffering from hunger.  They discussed the notion of a "poverty trap" which is essentially a predicament many poor people find themselves in when they cannot afford to eat enough food which leaves them unproductive and unable to pull themselves out of poverty.  Malnutrition is the root of the poverty trap which keeps many people in poverty in poor parts of the world.  The authors look at what effects increases in incomes has on peoples food consumption.  The assumption is that with more money people will buy more food and consequently become more productive and be lifted out of poverty.  However, they found that many people choose to buy better tasting and quality food rather than buying more food which has no impact on how much nutrition they are receiving.  Also, people elect to purchase luxury goods such as cell phones, televisions, and DVD players with any extra income because of the utility they get from these goods.  Nourishment as an infant and young child, they found, has been associated with greater health and success later in life because it allows you to reach your full physical and intellectual potential.  The better you eat in your early years, the authors say, the more productive you can be as an adult and hopefully avoid the hunger-based poverty trap.  In the end they conclude that much of the food policy is focused on providing cheaper grain for people; however, they argue that it is not necessarily cheaper grain that will remedy the problem, it is more nutritious foods and investments in nutrition that will help the poor become more healthy. 

The hunger-based poverty trap that the authors discuss is the idea that people who are malnourished are unproductive and therefore remain poor.  The authors look to several anecdotes to help explain how people can be caught in this poverty trap.  One man that they studied had lost his job as an agricultural laborer and was too old to begin a new job in construction.  Without any income his family was forced to split up just to survive.  He now lives off the help of his brother and the little food he can get for himself.  The man attributed the fact that no one would hire him to not having enough food and therefore not being a useful worker. 

The authors also reference their numerical data that they collected in their eighteen-country study to illustrate the problem of the nutrition-based poverty trap.  They stated that in these countries food accounted for about 50 percent of of consumption.  Other consumption by the people in these countries was devoted to "luxury" goods such as alcohol, cigarettes, parties, and televisions.  They found that because those people were living in such bad conditions, having something such as a party or television that could make them happy was extremely important to them.  One man even stated that the television was more important to him than food. The authors found that many people in poor countries chose to purchase luxury items rather than food with income that they had available to them which left many of them under nourished.  And, when they do choose to spend additional income on food, it is spent mostly on better food rather than more food. The authors use the data and statistics collected from this study, along with anecdotal evidence, to show that many people do get trapped in poverty due to a lack of nutrition in their diets which results in an inability to be productive. 

I believe that the theory of a hunger-based poverty trap makes perfect sense, however I am not sure if it is the sole factor in why people remain poor.  I do think that the evidence they provide certainly suggests that a lack of food has profound effects on ones' well-being and ability to be production.  But, there are many other reasons why people remain in poverty.  In many of the countries that they studied there are not as many opportunities to become wealthy, especially for those who live in rural areas in which agricultural labor may be the only option for work.  Also, the poor have a harder time moving from place to place which results in them literally being stuck in one location in some cases.  So, even though malnutrition greatly effects people, it is only one piece of what keeps people in the so called "poverty trap".