Publication: You Are What (and Where) You Eat: Capturing Food Away from Home in Welfare Measures
Date
2015-05
ISSN
Published
2015-05
Author(s)
Abstract
Consumption of food away from home is
rapidly growing across the developing world. Surprisingly,
the majority of household surveys around the world haven not
kept up with its pace and still collect limited information
on it. The implications for poverty and inequality
measurement are far from clear, and the direction of the
impact cannot be established a priori, since consumption of
food away from home affects both food consumption and the
poverty line. This paper exploits rich data on food away
from home collected as part of the National Household Survey
in Peru, shedding light to the extent to which welfare
measures differ depending on whether they properly account
for food away from home. Peru is a relevant context, with
the average Peruvian household spending 28 percent of their
food budget on food away from home by 2010. The analysis
indicates that failure to account for the consumption of
food away from home has important implications for poverty
and inequality measures as well as the understanding of who
the poor are. First, accounting for food away from home
results in extreme poverty rates that are 18 percent higher
and moderate poverty rates that are 16 percent lower. These
results are also consistent, in fact more pronounced, with
poverty gap and severity measures. Second, consumption
inequality measured by the Gini coefficient decreases by 1.3
points when food away from home is included, a significant
reduction. Finally, inclusion of food away from home results
in a reclassification of households from poor to non-poor
status and vice versa: 20 percent of the poor are different
when the analysis includes consumption of food away from
home. This effect is large enough that a standard poverty
profile analysis results in significant differences between
the poverty classification based on whether food away from
home is included or not. The differences cover many
dimensions, including demographics, education, and labor
market characteristics. Taken together, the results indicate
that a serious rethinking of how to deal with the
consumption of food away from home in measuring well-being
is urgently needed to properly estimate and understand
poverty around the world.
Link to Data Set
Citation
“Farfan, Gabriela; Genoni, Maria Eugenia; Vakis, Renos. 2015. You Are What (and Where) You Eat: Capturing Food Away from Home in Welfare Measures. Policy Research Working Paper;No. 7257. © World Bank, Washington, DC. http://hdl.handle.net/10986/21987 License: CC BY 3.0 IGO.”
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