DP12264 Buy As You Need: Nutrition and Food Storage Imperfections
In this paper, we investigate how the activation of local food markets impacts the nutritional status of both children and adults, in a context characterized by large seasonal fluctuations in the price and availability of foodgrain. Taking advantage of the random scaling-up of a program of Food Security Granaries (FSGs) in Burkina Faso, we make three contributions. First, especially in remote areas where local markets are thin, food market activation considerably dampens nutritional stress. The effect is strongest among children, and young children in particular, for whom deficient nutrition has devastating long-term consequences. Second, and surprisingly, this beneficial effect is obtained despite the fact that total food consumption does not increase as a result of the external intervention. Third, it is a change in the timing of food purchase, translated into a change in the timing of consumption, that drives the nutritional improvement. A simple two-period model shows that an increase in consumption needs not take place when the price of foodgrain declines during the lean season if storage losses are taken into account. More than from the waste of the foodgrain stored, storage costs mainly arise from a self-control problem: foodgrain purchased anticipatorily results in immediate consumption and body mass accumulation, which is less efficient than nutrition-smoothing consumption flows.