Thursday, August 18, 2005

What would Stigler say about the cost of a healthy diet in Boston?

The Boston Medical Center, with support from Project Bread, this month reported (.pdf) the costs of purchasing the market basket stipulated in USDA's Thrifty Food Plan -- and a healthier food plan -- in Boston's metropolitan area. The researchers estimated, plausibly, that the Thrifty Food Plan cost $524 monthly for a family of four, or $27 more than the Federal Government estimates is needed for the maximum food stamp benefit nationally. This difference makes sense, because Boston food prices are likely to be somewhat higher than the national average.

For the healthier food plan, the researchers estimate that a family of four would need $645 monthly for food at home, or $148 more than the maximum food stamp benefit. However, for a family of four, the national average monthly spending for food at home is $385, and the national average monthly spending for all food (including restaurant food) is $652. For a low-income family of four (with annual income of $15k-$20k), the average monthly spending for food at home is $350, and the average monthly spending for all food is $468. I believe that even with some adjustment for higher than average prices in Boston, the $645 figure seems too high. To corroborate all the number crunching, my family of four buys a diet very high in fresh fruits and vegetables for much less than $645 monthly in the Boston metropolitan area. I would like to see more detail than the report provides about the basket of foods it used for the healthy diet calculation.

The Boston Medical Center report calls for increased federal food stamp benefits. The issue is not just whether low income families need more resources -- they certainly do! The question is whether one really wants to increase the maximum food stamp benefit for a family of four to $600 (more than many prosperous Bostonians spend on food in grocery stores), and then insist that even the most destitute beneficiaries of the program may not by law spend those resources on housing, transportation, education, health care, or any other important need. Such a high targeted benefit means, for example, that while most Americans rely on a combination of groceries and food away from home to feed their families, low-income Americans would be essentially required to spend far more in grocery stores alone. It seems unduly paternalistic.

As an interesting historical footnote, I was just re-reading George Stigler's classic 1945 paper on the cost of subsistence, in preparation for my class in U.S. Food Policy this coming fall. The paper is now available for free from Cornell's wonderful Core Historical Literature of Agriculture. For the record, since some of my nutrition colleagues dislike this type of minimum cost study, I'll mention that I don't endorse everything Stigler says. Still, I can't help quoting for your consideration Stigler's six-decades-old-but-timely provocative comments on why dieticians seemed to think a healthy diet cost much more than he did:
The first [reason] is that the particular judgments of the dieticians as to minimum palatability, variety, and prestige are at present highly personal and non-scientific, and should not be presented in the guise of being parts of a scientifically-determined budget. The second reason is that these cultural judgments, while they appear modest enough to government employees and even to college professors, can never be valid in such a general form.... If the dieticians persist in presenting minimum diets, they should at least report separately the physical and cultural components of these diets.

1 comment:

David Skul said...
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