The aggregate income losses from childhood stunting and the returns to a nutrition intervention aimed at reducing stunting

We undertake two calculations, one for all developing countries, the other for 34 developing countries that together account for 90% of the world’s stunted children. The first asks how much lower a country’s per capita income is today as a result of having a fraction of its workforce been stunted in childhood. We use a development accounting framework, relying on micro-econometric estimates of the effects of childhood stunting on adult wages through their effects on years of schooling, cognitive skills, and height, parsing out the relative contribution of each set of returns to avoid double counting. We estimate that, on average, the per capita income penalty from stunting is between 5–7%, depending on the assumption. In our second calculation we estimate the economic value and the costs associates with scaling up a package of nutrition interventions using the same methodology and set of assumptions used in the first calculation. We take a package of 10 nutrition interventions that has data on both effects and costs, and we estimate the rate-of-return to gradually introducing this program over a period of 10 years in 34 countries that together account for 90% of the world’s stunted children. We estimate a rate-of-return of 12%, and a benefit-cost ratio of 5:1-6:1.