Chapter 4


types of people who are likely to be food insecure. The top row shows the policy changes
under consideration. Losers are identified with a minus sign, gainers with a plus sign, and a
question mark indicates uncertainty (in some cases, one section of a group may gain while
another loses, or it may simply be impossible to predict with the information the analyst has).
Table 4.2 shows a hypothetical example of such an exercise.

Two policies are examined, a currency devaluation and a removal of consumer food subsidies.
The currency devaluation will increase the domestic price of food and other tradables (for
definition and further explanations see Annex 2A), thus giving incentives for higher domestic
production of tradables relative to non-tradables. Groups who are food consumers and who do
not produce tradables, the unskilled landless, deficit subsistence farmers, the informal sector.
public sector employees and pensioners, will be worse off. Farmers who produce tradables may
well be better off, depending on how much they produce relative to how many tradables they
buy. The same is true for formal sector entrepreneurs. Private sector employees may well be
worse off initially, though more employment opportunities could open up. The same is true for
agricultural labourers. Female-headed households could benefit or not, depending on the nature
of their main income source.

Table 4.2 Hypothetical Policy Analysis Table: Impact on food security of vulnerable
groups

 Policy measure Devaluation Removing Consumer Food
 Subsidies
 Vulnerable Groups
 RURAL
 Unskilled landless
 Subsistence farmers (deficit)
 Low income farmers (food crop) + ?
 Low income farmers (cash crop) +
 Large farmers + ?
 Agricultural labourers +7 -?
 URBAN
 Informal sector/self-employed
 Public sector employees
 Formal private sector employees +7
 Formal sector entrepreneurs + -?
 GENERAL
 Female headed households ?
 Elderly pensioners

 Note: Vulnerable groups are those shown in italics.


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