Chapter 5


The picture depicts the main linkages of the food system with the main lines of impact of
food policies on the supply and demand factors determining household food entitlement of
poor and vulnerable groups. The effects and the major lines of impact are summarised in the
subsequent paragraphs. For details refer to the analysis in the preceding sections.

1) The supply side measures discussed in section 2 (agricultural/food production, pricing,
 stocking and import policies) influence aggregate food supplies, i.e. the volume of
 domestic food production, food stocks and food imports. Aggregate food supplies
 determine food availability at the food market (market supplies) as well as the food
 available for transfers (FFW and direct transfers) to target groups. The food for transfers
 may be procured through local purchases by governmental or non-governmental
 institutions, or may stem from food aid deliveries. Food aid deliveries from abroad
 concessionall food imports) are included in aggregate food supplies.

2) Effective household food demand and institutional demand are linked as demand factors
 with aggregate food supplies. This points to the importance of effective market demand
 (household and institutional demand) as a prerequisite for maintaining a certain level of
 domestic market production..

3) Targeted production support measures (1) link through the segregated food, input and/or
 credit markets with the elements household income, aggregate food supplies (marketed
 food production by smallholder target groups) and subsistence production. Increased
 household income (resulting from increased sales revenues of marketed smallholder
 production) results in increased household food demand, hence increased market access
 to food, while increased subsistence production of the target group directly augments
 household food supplies.

4) Public works programmes (2) directly influence the labour market. They contribute to
 increase household cash incomes or, in the case of FFW, household food supplies. By
 improving the production basis, the assets created through public works programmes may
 also contribute to increased domestic food production and aggregate food supplies
 (indirect effects on aggregate food supplies).

 5) Targeted food subsidies (3) directly influence the (prices on the) segregated food market.
 Lower food prices will increase the real household income of the target group, and, in
 turn, increase effective household food demand of the target groups.

 6) All types of targeted interventions (1,2,3,4) require special infrastructural provisions, in
 order to establish and to administer the segregated markets, and to ensure that the
 intended target groups are effectively reached.

 7) In the case of direct food transfers (4) these are, for example, institutions which undertake
 local purchases or receive external food aid supplies (indicated as institutional demand
 arrow), and which distribute food rations (institutional supplies) to the beneficiaries. The
 direct food transfers directly increase household food supplies of the target groups.


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