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Publication | 9 February 2021

Role of income inequality in shaping outcomes on individual food insecurity

Despite relatively high economic growth rates in many developing countries in the last two decades, income inequality has remained high and even increased. This has important policy implications for achieving reductions in food insecurity. As evidence from this paper suggests, high-income inequality undercuts the benefits of economic growth in reducing food insecurity. This paper uses the 2014 Gallup World Poll (GWP) dataset on a sample of 75 low- and middle-income countries for which cross-country comparable measures of individual food insecurity based on the Food Insecurity Experience Scale (FIES) are available. By means of a three-level linear probability model that controls for the presence of individual and household (first level), country (second level) and the macro-region (third level), we assess the macro-economic effects of economic growth and income inequality on individual food insecurity. Results show that increases in gross domestic product (GDP) per capita are concurrent with declines in individual food insecurity, both in terms of severe food insecurity (people running out of food and experiencing hunger) and moderate or severe food insecurity (also including people who face uncertainties about their ability to obtain food and have to compromise on the quality and/or quantity of food consumed). Specifically, a 10 percent increase in GDP per capita is associated with a 4–7 percent decrease in individual food insecurity. However, the effect of living in a country with highincome inequality significantly undercuts the positive effect of economic growth on individual food security. Individuals living in countries with a high Gini index have on average a 33 percentage point higher probability of experiencing severe food insecurity and a 42 percentage points higher probability of moderate or severe food insecurity. The findings suggest that by tackling income inequality, economic growth can become a force for reducing food insecurity in low- and middle-income countries.

Role of income inequality in shaping outcomes on individual food insecurity

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