Socio-Economic Determinants of Food Price Vulnerability in South Asia: A Case Study of India

Abstract

Following the classic works of Engel (1857) and Houthakker (1957), the share of food in the consumption basket, in addition to its significance for welfare, is considered to be an indicator of the level of development as well. In India, household consumption surveys conducted by the National Sample Survey Organization (NSSO) provide granular information about the food consumption basket of the sampled households. Recent Household Consumption Expenditure Survey (HCES) 2021-22 includes a number of detailed questions not only on the purchased food items but also on the quantities received through various public welfare programs. The survey includes information on principal economic activity and landholding as well. Thus, the collected information allows us to examine questions about the agrarian economy in general, and about the patterns of food consumption in particular. Using this dataset, this paper attempts to understand and test some hypotheses related to the political economy of Indian agriculture. Specifically, how does the food consumption pattern of the landless casual workers differ from landed farmers in the country? What will be the distributive impact of the food inflation in rural India? Is there any systematic difference between different social (SC/ST/OBCs/Others) and economic categories regarding food price vulnerability? Finally, to what extent has the Public Distribution System been able to mitigate vulnerability? The paper locates these specific issues in the broader context of rural and agrarian development.