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The Potential and Limitations of Self-Targeted Food Subsidies

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  • Alderman, Harold
  • Lindert, Kathy

Abstract

Can self-selection of subsidized commodities be used as a mechanism to transfer income to the poor? Evidence from two self-targeting programs, one in South Africa and one in Tunisia, shows that although self-targeting can clearly improve the distribution of food subsidies to the poorest members of society, its power to alleviate poverty and reduce income disparities is limited by preference patterns, income inequality, and the size of the individual subsidies. Self-targeting through quality and product differentiation can be a useful means to reform existing universal subsidy schemes, but it should be considered a transitional tool while the capacity for implementing more precise mechanisms is developed. Copyright 1998 by Oxford University Press.

Suggested Citation

  • Alderman, Harold & Lindert, Kathy, 1998. "The Potential and Limitations of Self-Targeted Food Subsidies," The World Bank Research Observer, World Bank, vol. 13(2), pages 213-229, August.
    • Handle: RePEc:oup:wbrobs:v:13:y:1998:i:2:p:213-29
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    References listed on IDEAS

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    1. Besley, Timothy J & Kanbur, S M Ravi, 1988. "Food Subsidies and Poverty Alleviation," Economic Journal, Royal Economic Society, vol. 98(392), pages 701-719, September.
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    6. Tuck, L. & Lindert, K., 1996. "From Universal Food Subsidies to a Self-Targeted Program: A Case Study in Tunisian Reform," World Bank - Discussion Papers 351, World Bank.
    7. Alderman, Harold, 1987. "Allocation of goods through non-price mechanisms : Evidence on distribution by willingness to wait," Journal of Development Economics, Elsevier, vol. 25(1), pages 105-124, February.
    8. Nichols, Albert L & Zeckhauser, Richard J, 1982. "Targeting Transfers through Restrictions on Recipients," American Economic Review, American Economic Association, vol. 72(2), pages 372-377, May.
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