Self-Targeted Subsidies : The Distributional Impact of the Egyptian Food Subsidy System

The Egyptian food subsidy system is an untargeted system that is essentially open to all Egyptians. For this reason, the budgetary costs of this system have been high, and the ability of this system to improve the welfare status of the poor has bee...

Full description

Bibliographic Details
Main Author:	Adams, Richard H. Jr.
Format:	Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2015
Subjects:	AGRICULTURE BAKING BASIC FOODS BRAN BREAD CEREALS CIGARETTES EGGS FOOD AID FOOD CONSUMPTION FOOD DEMAND FOOD IMPORTS FOOD POLICY FOOD POLICY RESEARCH FOOD RATIONING FOOD RIOTS FOOD STAMPS FOOD SUBSIDIES FOOD SUBSIDY FOOD SUBSIDY PROGRAMS FOODS FROZEN FISH FROZEN MEAT INCOME INCOME TRANSFERS INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE NUTRITIONAL STATUS POLITICAL SUPPORT POOR POVERTY REDUCTION RICE SUGAR TARGETING TEA TRANSFER PROGRAMS WAR WHEAT FLOUR
Online Access:	http://documents.worldbank.org/curated/en/2000/04/437752/self-targeted-subsidies-distributional-impact-egyptian-food-subsidy-system http://hdl.handle.net/10986/22207

id	okr-10986-22207
recordtype	oai_dc
spelling	okr-10986-222072021-04-23T14:04:06Z Self-Targeted Subsidies : The Distributional Impact of the Egyptian Food Subsidy System Adams, Richard H. Jr. AGRICULTURE BAKING BASIC FOODS BRAN BREAD CEREALS CIGARETTES EGGS FOOD AID FOOD CONSUMPTION FOOD DEMAND FOOD IMPORTS FOOD POLICY FOOD POLICY RESEARCH FOOD RATIONING FOOD RIOTS FOOD STAMPS FOOD SUBSIDIES FOOD SUBSIDY FOOD SUBSIDY PROGRAMS FOODS FROZEN FISH FROZEN MEAT INCOME INCOME TRANSFERS INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE NUTRITIONAL STATUS POLITICAL SUPPORT POOR POVERTY REDUCTION RICE SUGAR TARGETING TEA TRANSFER PROGRAMS WAR WHEAT FLOUR The Egyptian food subsidy system is an untargeted system that is essentially open to all Egyptians. For this reason, the budgetary costs of this system have been high, and the ability of this system to improve the welfare status of the poor has been questioned. Since the food riots of 1977, Egyptian policymakers have been reluctant to make large changes in their food subsidy system. Rather, their strategy has been to reduce the costs, and coverage of this system gradually. For example, since 1980 policymakers have reduced the number of subsidized foods from 20 to just four. Despite these cutbacks, the author uses new 1997 household survey data to show that the Egyptian food subsidy system is self-targeted to the poor, because it subsidizes inferior goods. In urban Egypt, for instance, the main subsidized food - coarse baladi bread - is consumed more by the poor (the lowest quintile group of the population) than by the rich (the highest quintile). So subsidizing baladi bread is a good way of improving the welfare status of the urban poor. Bur in rural Egypt, where the poor do not consume so much baladi bread, the poor receive less in income transfers than the rich. In many countries, administrative targeting of food subsidies can do a better job of targeting the poor than self-targeting systems. In Jamaica, for example, poor people get food stamps at health clinics, so the Jamaican poor receive double the income transfers from food subsidies than the Egyptian poor receive. Bur starting a comparable system in Egypt, would be costly both in financial, and political terms, because many non-poor households currently receiving food subsidies would have to be excluded. For these reasons, it is likely that the government will continue to refine the present food subsidy system, perhaps by eliminating current subsidies on sugar or edible oil. Neither of these foods is an inferior good, so eliminating these subsidies will have only a minimal impact on the welfare status of the poor. 2015-07-17T17:35:15Z 2015-07-17T17:35:15Z 2000-04 Working Paper http://documents.worldbank.org/curated/en/2000/04/437752/self-targeted-subsidies-distributional-impact-egyptian-food-subsidy-system http://hdl.handle.net/10986/22207 English en_US Policy Research Working Paper;No. 2322 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Middle East and North Africa Egypt, Arab Republic of
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	AGRICULTURE BAKING BASIC FOODS BRAN BREAD CEREALS CIGARETTES EGGS FOOD AID FOOD CONSUMPTION FOOD DEMAND FOOD IMPORTS FOOD POLICY FOOD POLICY RESEARCH FOOD RATIONING FOOD RIOTS FOOD STAMPS FOOD SUBSIDIES FOOD SUBSIDY FOOD SUBSIDY PROGRAMS FOODS FROZEN FISH FROZEN MEAT INCOME INCOME TRANSFERS INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE NUTRITIONAL STATUS POLITICAL SUPPORT POOR POVERTY REDUCTION RICE SUGAR TARGETING TEA TRANSFER PROGRAMS WAR WHEAT FLOUR
spellingShingle	AGRICULTURE BAKING BASIC FOODS BRAN BREAD CEREALS CIGARETTES EGGS FOOD AID FOOD CONSUMPTION FOOD DEMAND FOOD IMPORTS FOOD POLICY FOOD POLICY RESEARCH FOOD RATIONING FOOD RIOTS FOOD STAMPS FOOD SUBSIDIES FOOD SUBSIDY FOOD SUBSIDY PROGRAMS FOODS FROZEN FISH FROZEN MEAT INCOME INCOME TRANSFERS INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE NUTRITIONAL STATUS POLITICAL SUPPORT POOR POVERTY REDUCTION RICE SUGAR TARGETING TEA TRANSFER PROGRAMS WAR WHEAT FLOUR Adams, Richard H. Jr. Self-Targeted Subsidies : The Distributional Impact of the Egyptian Food Subsidy System
geographic_facet	Middle East and North Africa Egypt, Arab Republic of
relation	Policy Research Working Paper;No. 2322
description	The Egyptian food subsidy system is an untargeted system that is essentially open to all Egyptians. For this reason, the budgetary costs of this system have been high, and the ability of this system to improve the welfare status of the poor has been questioned. Since the food riots of 1977, Egyptian policymakers have been reluctant to make large changes in their food subsidy system. Rather, their strategy has been to reduce the costs, and coverage of this system gradually. For example, since 1980 policymakers have reduced the number of subsidized foods from 20 to just four. Despite these cutbacks, the author uses new 1997 household survey data to show that the Egyptian food subsidy system is self-targeted to the poor, because it subsidizes inferior goods. In urban Egypt, for instance, the main subsidized food - coarse baladi bread - is consumed more by the poor (the lowest quintile group of the population) than by the rich (the highest quintile). So subsidizing baladi bread is a good way of improving the welfare status of the urban poor. Bur in rural Egypt, where the poor do not consume so much baladi bread, the poor receive less in income transfers than the rich. In many countries, administrative targeting of food subsidies can do a better job of targeting the poor than self-targeting systems. In Jamaica, for example, poor people get food stamps at health clinics, so the Jamaican poor receive double the income transfers from food subsidies than the Egyptian poor receive. Bur starting a comparable system in Egypt, would be costly both in financial, and political terms, because many non-poor households currently receiving food subsidies would have to be excluded. For these reasons, it is likely that the government will continue to refine the present food subsidy system, perhaps by eliminating current subsidies on sugar or edible oil. Neither of these foods is an inferior good, so eliminating these subsidies will have only a minimal impact on the welfare status of the poor.
format	Working Paper
author	Adams, Richard H. Jr.
author_facet	Adams, Richard H. Jr.
author_sort	Adams, Richard H. Jr.
title	Self-Targeted Subsidies : The Distributional Impact of the Egyptian Food Subsidy System
title_short	Self-Targeted Subsidies : The Distributional Impact of the Egyptian Food Subsidy System
title_full	Self-Targeted Subsidies : The Distributional Impact of the Egyptian Food Subsidy System
title_fullStr	Self-Targeted Subsidies : The Distributional Impact of the Egyptian Food Subsidy System
title_full_unstemmed	Self-Targeted Subsidies : The Distributional Impact of the Egyptian Food Subsidy System
title_sort	self-targeted subsidies : the distributional impact of the egyptian food subsidy system
publisher	World Bank, Washington, DC
publishDate	2015
url	http://documents.worldbank.org/curated/en/2000/04/437752/self-targeted-subsidies-distributional-impact-egyptian-food-subsidy-system http://hdl.handle.net/10986/22207
_version_	1764449833087664128

Self-Targeted Subsidies : The Distributional Impact of the Egyptian Food Subsidy System

Similar Items