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Is the PDS Already a Cash Transfer? Rethinking India's Food Subsidy Policies

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  • Sujata Balasubramanian

Abstract

Critics argue that India's mismanaged Public Distribution System (PDS), which sells subsidised cereals to poor families, should be replaced by cash transfers. Others fear cash may be misused. Using National Sample Survey data, this article demonstrates that families treat additional PDS subsidies wholly as a source of cash - exactly like a cash transfer. More worryingly, cereal consumption has not increased, despite higher real subsidies. Moreover, neither the PDS nor cash transfers are likely to raise total food expenditure in poor families. Finally, therefore, the paper explores how higher food consumption and other objectives of PDS subsidies may be achieved.

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  • Sujata Balasubramanian, 2015. "Is the PDS Already a Cash Transfer? Rethinking India's Food Subsidy Policies," Journal of Development Studies, Taylor & Francis Journals, vol. 51(6), pages 642-659, June.
    • Handle: RePEc:taf:jdevst:v:51:y:2015:i:6:p:642-659
    DOI: 10.1080/00220388.2014.997221
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    1. World Bank, 2011. "Social Protection for a Changing India : Executive Summary," World Bank Publications - Reports 2746, The World Bank Group.
    2. Breunig, Robert & Dasgupta, Indraneel & Gundersen, Craig & Pattanaik, Prasanta, 2001. "Explaining The Food Stamp Cash-Out Puzzle," Food Assistance and Nutrition Research Reports 33869, United States Department of Agriculture, Economic Research Service.
    3. World Bank, 2011. "Social Protection for a Changing India : Main Report," World Bank Publications - Reports 2745, The World Bank Group.
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    Cited by:

    1. Vandita Dar & Madhvi Sethi & Saina Baby, 2023. "Direct Cash Transfers in Emerging Economies: The Case of India," Business Perspectives and Research, , vol. 11(2), pages 287-308, May.
    2. Jaspars, S. & Sathyamala, C., 2021. "Digital bodies and digitalised welfare: North-South linkages in the politics of food assistance and social welfare," ISS Working Papers - General Series 687, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
    3. Phadera,Lokendra & Sharma,Dhiraj & Wai-Poi,Matthew Grant, 2020. "Iraq's Universal Public Distribution System : Utilization and Impacts During Displacement," Policy Research Working Paper Series 9155, The World Bank.
    4. Nelson Benjamin Villoria & Elliot Wamboka Mghenyi, 2017. "The Impacts of India's Food Security Policies on South Asian Wheat and Rice Markets," The World Bank Economic Review, World Bank, vol. 31(3), pages 730-746.
    5. Aurino, Elisabetta & Morrow, Virginia, 2018. "“Food prices were high, and the dal became watery”. Mixed-method evidence on household food insecurity and children’s diets in India," World Development, Elsevier, vol. 111(C), pages 211-224.
    6. Min Zhu & Chuanmin Shuai & Xiaoyan Wang & Zhihui Leng & Fan Zhang, 2019. "Analysis of China’s policy effect on poverty alleviation: evidence from Chongqing in the Three Gorges Reservoir Region," Quality & Quantity: International Journal of Methodology, Springer, vol. 53(3), pages 1325-1345, May.

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