Does Food Aid Really Discourage Food Production?

Document Type

Article

Journal/Book Title/Conference

Indian Journal of Agricultural Economics

Volume

54

Issue

2

Publication Date

1999

First Page

212

Last Page

219

Abstract

We examine whether food aid necessarily acts as a disincentive to food production in recipient economies. Since structural deficiencies of markets are a central reason why low-income agrarian economies receive food aid, we adopt a modeling framework that accommodates incomplete or imperfect markets. This simple, nonseparable, representative household model highlights the factor market effects of food aid overlooked in conventional, Schultzian analyses and, thus, the ambiguous effects of food aid on food production incentives in recipient economies

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