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Assessing the effect of food retail subsidies on the price of food in remote Indigenous communities in Canada

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  • Naylor, Jamie
  • Deaton, B. James
  • Ker, Alan

Abstract

The Canadian government currently subsidizes food retailers in the 25 remote communities in Nunavut through the Nutrition North Canada program. The program expects each dollar of the food subsidy to be fully passed on to the consumer in the form of lower prices. Unfortunately, existing audits and reviews of the program have failed to determine the pass-through rate of the subsidy. Using regression analysis on food price data in each of the 25 communities, subsidy rates, and covariates that control for community characteristics, we overcome the limitations of past research and provide the first-ever estimate of the pass-through rate of Nutrition North in Nunavut. Our results suggest that most, if not all, of the subsidy is passed on to the consumer in lower food prices.

Suggested Citation

  • Naylor, Jamie & Deaton, B. James & Ker, Alan, 2020. "Assessing the effect of food retail subsidies on the price of food in remote Indigenous communities in Canada," Food Policy, Elsevier, vol. 93(C).
    • Handle: RePEc:eee:jfpoli:v:93:y:2020:i:c:s0306919220300919
    DOI: 10.1016/j.foodpol.2020.101889
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    Cited by:

    1. Galloway, Tracey & Li, Nicholas, 2023. "Pass-through of subsidies to prices under limited competition: Evidence from Canada’s Nutrition North program," Journal of Public Economics, Elsevier, vol. 225(C).
    2. B. James Deaton & Brady J. Deaton, 2020. "Food security and Canada's agricultural system challenged by COVID‐19," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 68(2), pages 143-149, June.
    3. B. James Deaton & Brady J. Deaton, 2021. "Food security and Canada's agricultural system challenged by COVID‐19: One year later," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 69(2), pages 161-166, June.
    4. Nicholas Li & Tracey Galloway, 2023. "Pass-through of subsidies to prices under limited competition: Evidence from Canada’s Nutrition North program," Working Papers 085, Toronto Metropolitan University, Department of Economics.

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