Improved nutrition has been found to have positive impacts on the earnings, cognitive function, and decision-making of the poor. This holds great potential if complemented by nutrition education, and supported by policy and government investment.
One-seventh of the world’s population consumes fewer calories than recommended by health officials. In India, this number is as high as three-quarters of the population, according to some estimates (Deaton and Dreze 2009). Low caloric intake has the potential to harm health and reduce quality of life. The negative effects may also extend in another direction: low caloric consumption has the potential to reduce productivity and income, and impede one’s ability to make good decisions, such as whether to save money or send a child to school.
If such effects occur, there is further potential for a feedback loop between low consumption and poverty, which may make escaping poverty even more challenging. These effects are not just of academic interest - they are also of significant relevance to optimal policy design regarding food production, distribution, and consumption among the world’s poorest. Yet research to-date has faced significant challenges in generating rigorous causal evidence on the relationship between low caloric intake and labour market outcomes, cognitive function, and decision-making.
To fill this gap in evidence, we are conducting a randomised controlled trial (RCT) with 400 low-body mass index (BMI, a measure of weight for height) cycle-rickshaw peddlers in Chennai, India. All participants visit the study office daily for seven weeks to report their hours and earnings at high frequency. The participants are first randomised into a food treatment group, receiving a mixture of cash and food, and a food control group, receiving cash only to incentivize attendance.
The boost in consumption among treated participants, equivalent to roughly 700 calories per day, will allow us to observe the impact of a large, sustained, and exogenous increase in caloric intake on two main categories of outcomes:
- Labour market outcomes (labour supply, income): We measure labour market outcomes by surveying participants daily on hours worked and income earned. We also provide supplementary measures of labour market engagement by placing GPS and cycle computer devices on participants’ rickshaws to measure distance traveled.
- Cognitive function and decision-making: We measure cognitive function with a battery of cognitive tests designed to assess underlying cognitive abilities related to productivity and decision making, such as attention, reaction time, and executive control. We also directly measure changes in economic decision-making, including savings rates and rates of time preference in labour supply. By investigating cognitive function and decision-making in the lab, we are tapping into an import but understudied channel by which low caloric intake could feed back into poverty.
Return on caloric investments
This research is motivated by a similar but smaller (211 participants) and shorter (five week duration) RCT. This earlier research generated promising results: it demonstrated 10-15% increases in labour supply, earnings, and cognitive function in the treatment group, resulting in a strongly positive return on investment – eating more paid for itself and then some.
These results, however, generated an additional puzzle. If calories appear to be an efficient and affordable investment, and the additional calories cost less than 5% of daily income, then why do so many continue to eat so little? This puzzle is particularly stark considering caloric intake in India has declined in recent years, despite rising incomes (Deaton and Dreze 2009; Subramanian and Deaton 1996).
Beliefs on the impact of nutrition
Supplemental surveys suggest that one possible explanation is incorrect beliefs about the returns on caloric intake and the caloric content of foods. For example, in an incentivised survey of roughly 200 demographically similar individuals, only one in five believed that increasing consumption would increase earnings. While potentially counterintuitive, these beliefs have a plausible physiological underpinning. When one eats more than usual, it initially produces lethargy. Yet, over time, the body adapts to the new level of consumption (e.g. the stomach becomes larger), producing divergent short run and long run feedback to changes in consumption. While the evidence is suggestive rather than conclusive, our pilot results imply that incorrect beliefs about the benefits of calories and the caloric content of foods may have the potential to limit consumption.
Knowledge of nutrition
Consequently, providing information on healthy eating habits has the potential to be very effective in encouraging higher consumption. To test this hypothesis, we incorporated an additional “Knowledge Treatment”. This treatment is provided in the fifth week of the study and is randomly assigned across all individuals in the study, creating a total of four experimental conditions. Participants in this treatment receive interactive motivational interviews and lessons on the caloric content of foods and the effect of under-consumption on energy and health.
This treatment also involves cooperatively creating a step-by-step plan for improving caloric intake, following strategies that are clearly realisable in the day-to-day lives of rickshaw peddlers in Chennai. For example, we review foods that are cheap, high in calories and readily available in the areas where they work. We then measure changes in knowledge and beliefs through an array of experimental surveys and tasks designed to measure changing perceptions of the caloric content of foods, the overall benefits of sufficient caloric intake, and the willingness to pay for foods that are high in calories. This additional randomisation will allow us to determine whether long run exposure to higher consumption, information about its benefits, or the combination of exposure and information can alter beliefs and food consumption habits.
Promoting investment in improved nutrition for the poor
This research will thus shed light not only on the potential for nutrition to improve the earnings, cognitive function, and decision-making of the poor, but also on the role that information plays in determining investment levels. As discussed previously, the lack of evidence on these relationships greatly hinders the development of appropriate policies regarding food distribution and consumption, an area of active policy debate and substantial government expenditures in many developing countries.