The Income Elasticity for Nutrition: Evidence from Unconditional Cash Transfers in Kenya

41 Pages Posted: 3 Apr 2019

See all articles by Ingvild Almås

Ingvild Almås

Stockholm University - Institute for International Economic Studies (IIES)

Johannes Haushofer

Harvard University; Massachusetts Institute of Technology (MIT) - Abdul Latif Jameel Poverty Action Lab (J-PAL)

Jeremy Shapiro

Busara Center for Behavioral Economics

Date Written: March 2019

Abstract

We use a randomized controlled trial to study the effect of large income changes, through unconditional cash transfers, on the food share of expenditures and consumption of calories among poor households in rural Kenya. Our preferred estimate of the food elasticity following USD 709 transfers is 0.78 for expenditure, 0.60 for calories, and 1.29 for protein. Experimental elasticities are lower than cross-sectional estimates. These estimates are unaffected by spillovers or price changes at the village level: results are similar with vs. without an almost ideal demand system, and with a control group in treatment vs. control villages.

Suggested Citation

Almås, Ingvild and Haushofer, Johannes and Shapiro, Jeremy, The Income Elasticity for Nutrition: Evidence from Unconditional Cash Transfers in Kenya (March 2019). NBER Working Paper No. w25711. Available at SSRN: https://ssrn.com/abstract=3363449

Ingvild Almås (Contact Author)

Stockholm University - Institute for International Economic Studies (IIES) ( email )

Stockholm, SE-10691
Sweden

Johannes Haushofer

Harvard University ( email )

1730 Cambridge Street
Cambridge, MA 02138
United States

Massachusetts Institute of Technology (MIT) - Abdul Latif Jameel Poverty Action Lab (J-PAL) ( email )

E53-379
30 Wadsworth St.
Cambridge, MA 02142
United States

Jeremy Shapiro

Busara Center for Behavioral Economics ( email )

Nairobi
Kenya

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