“The Economic Rationale for Investing in Nutrition in Developing Countries”

(1992) by Jere Behrman, USAID, Washington, D.C.

Jere Behrman has been one of the most active scholars in the field of economics of nutrition and human capital in developing countries. This publication, which summarizes what is known about the economic contribution of good nutrition, is another of his important contributions to the understanding of this complex topic. Whenever governments invest in programs such as nutrition, the most commonly used rationale is that it is part of the effort to meet the basic needs of the population, or generally the equity considerations. However, there is an economic argument, though less understood, for investing in nutrition, as Behrman points out. That is, that better nutrition increases the productivity of populations.

The publication is devoted to the review of evidence of the direct and indirect productivity effects of good nutrition. He has divided the evidence between the experimental surveys - using carefully designed controls - and the socio-economic surveys.

Behrman concludes that these studies tend to show that the returns to nutrition are even higher than the returns to education, although most education programs tend to have been much more emphasized in the literature. For example, studies in control of iron deficiency anemia have shown extremely high benefit-cost ratios, although he questions the assumptions related to the benefit side of the calculations. Nonetheless, the question is the order of magnitude of the benefits.

The available evidence, although hardly perfect, suggests that in terms of growth and productivity as well as equity concerns, there maybe payoffs to better nutrition in poorer areas of the developing world.

If the economic productivity gains to households from better nutrition are extremely high, as the studies would argue, why aren't households investing in these foods? Is it due to lack of specific nutrition knowledge? Behrman concludes that governments have the likely comparative advantage in assuring adequate information about nutrition, its nature, and its effects, given the public goods aspect of the information.

This publication is an important contribution to the state of knowledge of the relationship between nutrition and productivity in developing countries.

(For further information please contact: Office of Nutrition, USAID, 320 21st Street, N.W., Washington, D.C., 20523, USA. Tel: 703 875 4074 Fax: 703 875 7483)

M.G.