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Food security and hedonic behaviour: a case study of São Tomé e Prı́ncipe
Food Policy, Vol. 23, No. 3/4, pp. 263–275, 1998 1998 Elsevier Science Ltd. All rights reserved Printed in Great Britain 0306-9192/98/$ - see front matter
Pergamon
PII: S0306-9192(98)00034-7
Food security and hedonic behaviour: a case study of Sa˜o Tome´ e Prı´ncipe Bernardo R. P. De Carvalho* University of Lisbon, ISA, Tapada da Ajuda, 1300 Lisboa, Portugal Food security is still one of the main concerns in economic policy making in less developed countries. The objective of the present study is to analyse technological innovation and technological change induced by economics forces, with special attention to consumer behaviour. Consumer choice is studied together with the technological change process from the consumption side, such that efficiency problems can be handled if a certain number of weak assumptions can be accepted. The framework of the Lancaster model is used to study the impact on food security on Sa˜o Tome´ e Prı´ncipe, changing from a centralised economic policy to a market oriented economy. The paper addresses the need to understand how consumption innovation with the introduction of locally produced food consumption can be an efficient solution from the consumption point of view. The results obtained with the introduction of matabala into the consumption choice set show that free market functioning supports local products consumption as an efficient solution in Sa˜o Tome´ e Prı´ncipe. 1998 Elsevier Science Ltd. All rights reserved. Keywords: food security, hedonism, Sa˜o Tome´ e Prı´ncipe
Introduction The need to define a consumption technology, given that consumption efficiency can be studied and introduced into policy discussion, is one of the central aspects in the analysis of consumption and market behaviour. On the other hand, production technology is becoming only one of the factors, among others, in food production and food processing industry where market behaviour and organisation factors are, at least, of equal importance for a successful production system. Production technology was, until recently, almost always the dominant concern in solving food supply problems. Food security concern was, until the end of the 1970s, dominated by production technology constraints at the world level. Since then, food surpluses have been a constant problem in industrialised economies and food supply, at world level, not a relevant issue. The evolution of the economic development thought shows that food systems are the key to the understanding of food security problems (Gittinger et al., 1987). Indeed, the concept of food security, to a certain degree substituting the self-sufficiency goal in less developed countries, was developed
*Present address: Av. da Republica, no. 27-7, 1050 Lisboa, Portugal. Tel.: ⫹ 351 1 364 9858; Fax: ⫹ 351 1 352 3799
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and applied to take into consideration all factors from which good nutrition and food satisfaction are derived. The food security equation is established looking at two different sides, supply and demand driven factors. The economic development field, looking at structural changes of the economies in different development stages, and also identifying economic policies that can accelerate desired changes, provides a very clear picture of the structural economic forces that conditioned the food security equation at the national level. At least three different stages can be identified regarding the food security equation (that is, the supply – demand balance): Phase I, relative equilibrium based on natural resources sustainability; Phase II, excess demand driven by a fast population growth and industrialisation process; and Phase III, excess supply driven by a static population and food demand and a strong institutional capability to provide technology and productivity growth. As argued by Mellor and Johnston (1987, p. 47), ‘the first phase is rough parity of domestic supply and demand with real food prices constant except for sharp year to year, weatherinduced fluctuations’. In this phase low income countries are isolated from the global international environment, prior to the acceleration of their growth rates, either in population and/or production. The equilibrium between supply and demand is obtained based on natural resource use and availability. The second phase is characterised by a sharp population increase, a stronger industrialisation and openness to the world environment either in technology and/or capital. Today this phase is probably the most frequent among less developed countries, since there are almost no examples of complete isolation (the same cannot be said in regional terms) and natural equilibrium between supply and demand. The population growth, either through less child mortality and expansion of life expectation at birth and/or through increases in the fertility rate, tends to achieve levels above 2.5%. Considering the income effect expected in a rapid economic increase process, which characterises the initial phases of the industrialisation process, the food demand growth tends to be at least 4%. To guarantee an equilibrium in the food balance equation, food supply would have to increase at least at the same rate, which turns out to be a difficult goal (on a sustainable base) for a great number of less developed countries. As a consequence, those countries, in the specified phase, tend to increase food imports. The third phase is characterised by a stagnation of food demand and continuous production increase, driven by a strong research base and continuous tendency to improve factor productivity. This phase characterises the industrialised world in general, with slow or even close to zero population growth and continuous increase of supply, leading, in several known cases, to food exports and/or accumulation of surplus. Many countries in sub-Sahara Africa are now in the second phase. Some of them are also adopting structural adjustment programmes, in general changing from centrally planned economies to more open and market oriented economies. It is essential to study the results of such programmes on food security, including effects on production and consumption systems and respective sustainability. With the development process, changing food patterns in Africa have been studied by several authors, showing great pressure on increasing food imports (for example, Delgado and Miller, 1985). Of great concern is the increasing consumption habits of products which are not produced locally and/or cannot be adapted to local production conditions. Food aid is another factor which requires explicit attention to the effects on food markets. Several studies show the negative consequences of food aid on food production systems (Gittinger et al., 1987). A
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recent work by Tschirley et al. (1996) in regard to food aid in Mozambique (one of the most food aid-dependent countries in the world) points out the problematic effects, mainly in regard to white maize production and marketing system. In this paper, following a brief discussion on methodological issues, a country case study is presented using a specific simple method to study consumption behaviour and consumption efficiency. Local food products (matabala as an example) and competing imported foods are studied in terms of consumption choice and consumer efficiency in respect to changes in economic policy (from a centrally planned economy to a market oriented economy). A literature review on production technology and consumption technology is given in the next section. The Lancaster model and its derivations are given afterwards (third section). A case study of local foods and consumption eficiency in Sa˜o Tome´ e Prı´ncipe is given in the fourth section. Conclusions of the study form the final section.
Production technology and consumption technology The term ‘technology’ has been used mainly as linked to the identification of production processes and respective changes linked to technological or scientific knowledge. More recently and less frequently the term appears associated with consumption processes. Lancaster (1966a); Lancaster, (1966b)) is probably one of the first authors to use the term in association with the consumption process. The model developed provided an analytical structure that allows the introduction of the notion of consumption efficiency. Production and consumption can almost be viewed as a dual problem where the final denominator is the generation of utility. Indeed, the definition of production adopted is given in the following way: production is any process resulting from any given human activity, involving more than one input and aiming to create utility. As a corollary we can say that production always involves the notion of consumption since the generation of utility directly or indirectly is associated with an human element (a consumer). On the other hand, consumption activity always involves the notion of production, since consumption is a transformation process of goods and services into utility. Viewed through that analogy, the production process traditionally defined in terms of goods (in the first phase), services also (in a second phase) can now be viewed in terms of utility (which will be considered a third phase). The production process is transformed into a sequence of activities, a sequence of processes, in which the last linkage is the production of utility at consumer level. Household production theory is generally known by incorporating into models of household behaviour special assumptions, allowing an integration of the consumer’s theory with that of the firm. This approach is relevant to household decision making concerned with the efficient use of market goods, time and human capital. It is assumed that household obtains utility from some underlying goods that cannot be bought in the market but are instead produced in the household from inputs of market goods, time and human capital. Deaton and Muellbaker (1986, p. 247) clearly state: ‘In some contexts, the household production approach is not merely a clever or elegant way of looking at household decisions but the only appropriate way.’ Following this rational, it is of interest to look at the ‘inputs’ within the consumption activity. It is well known that utility cannot be measured in cardinal terms, but only in ordinal sequence. As a consequence, the last linkages in the consumption activity between goods and utility cannot be measured, unless we introduce another intermediate step, that is, the production of attributes/characteristics that can be measured. As a corollary we can say that each good or service can be evaluated in quantitative terms regarding some well-defined characteristics, and
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a residual term not well specified and/or not susceptible to quantification. In this situation it is assumed that the consumer has a preference order regarding attributes and characteristics solving a maximisation problem. In other words, it is possible to define an utility function, which arguments are the attributes, or sets of attributes, with a residual term, accounting for unknown variables or non-measurable variables. A central point to the analysis is the necessary condition of having common attributes in several goods/or services that can be measured.
Lancaster model and derivations This section is included to help explain and summarise the basic ideas. The model to be used is based on the methodology developed by Lancaster during the 1960s. The consumer is assumed to have a preference ordering over all possible characteristic sets (defined in vectorial terms) subject to a budget constraint, such that preference ordering is mainly established across characteristics, usually defined in vectorial terms. The consumer’s demand for goods and services can be viewed as a derived demand. Indeed, goods and services are ‘inputs’ to obtain desired characteristics/attributes. One of the most important features of the model refers to the fact that several goods/services have the same type of characteristics or, in other words, there are several characteristics in common in several goods/services. On the other hand, the substitution possibilities in consumption between goods, between services and also between goods and services are typically nonlinear, but the substitution possibilities among common characteristics in several goods/services are perfectly linear. The utility function can be defined in terms of n characteristics, in which n – m are common characteristics to several goods/services, where m are the specific characteristics of the goods/services. The number of goods/services is similar to or greater than m, which means that some goods/services might have no specific characteristics, including, for example, specific image on the market. With this structure and assumptions in mind it is possible to foresee the possibility of obtaining the same set of characteristics with different combinations of goods/services. These possibilities allow the introduction of the notion of efficiency in consumption, and the study of consumer options. The revealed preferences with the choices of goods/services also allows one to study and identify the specific characteristics of each good/service, looking at residual attributes and respective value. When there is no doubt about common characteristics that can be obtained with the consumption of different goods, and the specific attributes have no relevant weight (are not dominant) the preferences and consumer choice can be evaluated in terms of efficiency. Consider the following example (Fig. 1) with one consumer within a world with two goods (a and b) and two different characteristics (C1 and C2). Consider that each good has the two different characteristics and no specific attribute. Consider the space R2, with C1 and C2 coordinates. Each good can be represented by a vector in this space. Let’s assume that the consumer wants to choose or has a preference order for the specified C1 and C2 characteristics such that an indifference curve can be established. Assuming also a budget restriction, the figure below shows the possible consumption set and the efficient possible solutions represented by the vectors (a and b) and the possible combinations of these vectors. The efficient frontier is represented by a and b points and the line between the vectors. Any other solution is
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Figure 1 Consumer choice set, with two goods and two different characteristics
inefficient in the sense that it is always possible to obtain the same quantities of one characteristic improving the consumption of the other within the same budget restriction. The indifference curves are not drawn, but the preference ordering among characteristics can be studied without problems looking at the choice set and any possible well-behaved preference order. The maximisation set will include the line between the two vectors and the extreme points a and b. The introduction of a new good can be studied with great interest in terms of the specific contribution and/or in terms of enlargement of the efficient consumption set. If this new good has no specific attribute and can also be translated in terms of the common characteristics C1 and C2, depending on the price and specific contents of the characteristics, the new good will provide a new alternative to the consumer, but not necessarily improve the efficient consumption set. As a corollary to this rational, the simple model presented provides a structure with great interest in marketing research and also in terms of product innovation.
Case study of local foods and consumption efficiency in Sa˜o Tome´ e Prı´ncipe The model can be useful to study the food system and nutritional conditions, regarding consumption efficiency. For less developed countries in rapid structural changes the model discussed is of great interest. Another area of interest to apply the model to is the food system and nutritional issues. The nutritional efficiency problems in low income countries are crucial. The consumption capability available to the most part of the population does not justify the existence of ‘luxury goods and/or luxury characteristics’, that is, people are concerned to satisfy basic needs. Some times, as it is well known, habits, cultural background, and specific tastes can introduce restrictions in terms of transforming available food supply in common characteristics, which are, in nutritional terms, the basic nutrient contents. There is always the possibility to account for the specific attributes, for example, introducing a specific value percentage in terms of the price of the good, such that we can do the transformation of the good into common and specific characteristics. The application of the analytical model discussed is performed for a less developed country, Sa˜o Tome´ e Prı´ncipe. This country has an insular structure with two main islands, localised in the Gulf of Guinea, off the West coast of Africa, around 300 km from the Gabonese coast. Sa˜o Tome´ e Prı´ncipe is a country with an area of 1001 km2, divided into two main islands
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(860 for Sa˜o Tome´ and 140 km2 for Prı´ncipe). The rest of the country is divided into uninhabited small islands. The population is around 130,000 inhabitants, 6000 of them on the island of Prı´ncipe. The official language is Portuguese and the majority of the population are Roman Catholic. The climate is equatorial, warm and humid, with average temperatures ranging from 22° to 27°C. Annual rain fall varies from 800 mm in the North to more than 2000 mm in the South. Today there is a Parliamentary democracy. A former Portuguese province, Sa˜o Tome´ e Prı´ncipe, became an overseas province in 1951 and received local autonomy in 1973. Following the military coup in Portugal in April 1974, the Portuguese government recognised the right to independence. The economic policy, following independence, was dominated by a centrally planned perspective, with nationalisation of the main firms and farms. The country’s economy was dominated by cocoa plantations and cocoa exports. The cocoa exports achieved around US$30 millions at its maximum. This small country was, at some point in the past, the first cocoa producer in the world. At the independence the exports of cocoa were around US$10 million but decreased afterwards until recently. The political options taken by Sa˜o Tome´ e Prı´ncipe’s government began to change during the 1980s. The changes were on the direction of more liberal economy but the process took several years. The changes in the international political environment also helped to speed up this process. Under the 1990 Constitution, legislative power is vested in the National Assembly, which comprises 55 members, elected by universal suffrage for a term of 4 years. The President is elected by universal suffrage for a term of 5 years. The most significant changes in economic policy were performed after 1992. In 1992, according to the World Bank, the country gross national product (GNP) measured at 1990–1992 average prices, was US$44 million. In per capita terms the value estimated was US$370 per head. The population growth rate is estimated to be above 2%. Until 1987 the GDP decreased. The country didn’t have problems with balance of payments until 1980. Between 1980 and 1985 the economic situation deteriorated and the current balance account shifted from a surplus of US$7 million to a deficit of US$10 million. This situation led to the need of establishing a structural adjustment plan with the intervention of the World Bank and IMF. The economic situation improved with positive growth rates in most years after 1987 but still with an average growth below 2% (which still implies a per capita income decrease, unless population growth decreases significantly). The country received substantial aid in several forms from the international community. Food aid has been one of the main components of the international intervention linked with investment programmes, such as food for work and cocoa farms’ rehabilitation programmes. In food supply the country has an enormous dependence from imports, which are in great part obtained through donations. Generally, more than 50% of food consumption has been dependent on imports. Family consumption data (per week and for an average household size of four to five persons), presented in Table 1, shows the main imported food products. Palm oil is included because it is a close substitute for imported oil. There are other products that are important in the food consumption habits of the population of Sa˜o Tome´ e Prı´ncipe, such as fish, banana and more recently taro, known locally as matabala, all of them with local origin. It is not difficult to conclude that food aid and other external influences have been reducing the use of local products in the diet of the people. At least, it is consensual to say that food aid did not help adequate food consumption to local resources and local production potential. According to theory, consumption is much lower for the low income group. To test and
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Table 1 Average food consumption (kg or defined unity) per week and family, for several imported foods Food product
Total
60% higher income
40% lower income
Wheat flour Corn flour Rice Sugar Beans Palm oil Imp. vegetable oil Milk (power) Bread (unites of 10 g)
1.32 2.01 3.71 2.27 1.36 1.94 1.42 2.09 57.31
1.54 2.30 4.33 2.64 1.56 2.04 1.69 2.59 69.59
0.89 1.57 2.79 1.73 1.03 1.80 1.00 1.26 38.89
Note: Inquiry realised in S. Tome´ city (April, 1992). Table 2
Apparent consumption, 1988 – 1991, for several imported products (metric tonne)
Product
1988
1989
1990
1991
Wheat Rice Sugar Beans Vegetable oil Milk (powder)
2547 4603 1072 905 487 407
4901 3336 1214 1209 1457 189
4110 2179 1949 806 499 95
1675 3675 1086 942 358 362
Source: PNUD in S. Tome´ e Prı´ncipe and Ministe´rio de Economic Development e Financ¸as (1994, 1995).
validate the results, ‘apparent consumption’ was calculated based on disappearance, assuming no variation in stocks (Table 2). The problems of market supply based on imports (mainly donations) implies great variation in consumption. Commercial imports only recently began to be done by private entrepreneurs. The problems resulting from the small dimension of the market and the insular structure of the country make any stock management difficult and transport cost a key factor to be considered. Food imports are based on donations (biggest share) and marginal commercial transactions (Tables 3 and 4). Donations, unfortunately, tended to be very erratic, difficult to plan and not sustainable in a permanent way. Several authors and politicians have pointed out the urgent need to improve food security at the country level, promoting local production and better use of local resources. One important local resource is the use of native species that grow spontaneously, like matabala. Table 3 Imported food supply: donations and commercial imports (metric tonne)
Cereals Non-cereals
1988
Food donations 1989 1990
1991
1988
7175 1489
7895 3381
6861 1560
2372 1615
7259 1751
Commercial imports 1989 1990 2500 1765
1000 2480
1991 50 1846
Source: PNUD in S. Tome´ e Prı´ncipe and World Bank consultants. Note: Cereals include wheat flour, rice, and corn flour; non-cereals include beans, vegetable oil, power milk, fish, meat, sugar and salt.
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Food security and hedonic behaviour: a case study of Sa˜o Tome´ e Prı´ncipe: B. R. P. de Carvalho Table 4 Relative importance of food aid, in relation to total imports (percentage)
Cereals Non-cereals Total food aid Total imports
1988
1989
1990
1991
75 48 69 100
76 66 73 100
88 41 72 100
99 46 82 100
Source: author elaboration.
Ennes Ferreira (1990) provided a good discussion of the effects of matabala introduction into the diet. The study focus was poverty (level of absolute poverty) and the structural adjustment effects in the general population of the country. De Carvalho (de Carvalho, 1995a, b) also refers to this product and potentialities, explaining the good characteristics, which include being used for local food intake and also for export into regional markets, like Libreville (Gabon). Indeed, it was estimated that exports of matabala already achieved 20% of the value of cocoa exports, based on CLUSA (US Coop. League working as a non-governmental organisation) information and author estimations. The work performed by Ennes Ferreira (1990) provided the starting point of our analysis, using a similar structure in terms of the diets chosen and also questioning the effects of introducing matabala as a new product to improve welfare of the people. The economic policy, the structural adjustment programme effect and the study of the consumption efficiency regarding several consumption choices (market behaviour) are the core of the problems to be addressed. The main hypotheses considered were the following: (1) considering the gradual economic policy change, with the evolution from a typical centrally planned economy to a market economy, the market has been functioning (or not) promoting a gradual change in the population food consumption habits; (2) assuming that market functioning is reasonable, prices should reflect the relative scarcity of the products (including hard currencies), such that imported products should tend to have higher prices than local products; (3) the efficient consumer, if the conditions mentioned above hold, will tend to change in the direction of higher consumption of local products, such as matabala; and (4) the intervention of any institution or governmental campaign, through better information and education, trying to increase local products consumption might have no success or induce worse off situations to the general population if there is no adequate economic policy, namely, assuring the good functioning of the market. The methodology consisted of establishing four different diets (D1–D4), based on the habits of the people and increasing the diversification from D1 up to D4 (Table 5) and using the reference composition of the product set utilised in the calculation of the consumption price index. The products included were rice, beans, corn, oil, fish, and meat. The set of products and respective quantities in each diet was calculated having a minimum requirement of 3050 calories. Then, a new diet, ‘D5’, was considered, adding matabala in the consumption set with a 15% energy weight. Taking the reference of 3050 calories to be obtained with each diet, quantities of each food product and respective cost can be calculated. Establishing a referential budget per year, and taking into consideration the composition of the different diets, it was possible to calculate the quantities of protein and energy to be
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Table 5 Diet composition in % of calories Food product
D1
D2
D3
D4
D5
Rice Beans Corn Oil Fish Meat Matabala
90 5
75 13 5 5 2
50 25 15 3 5 2
30 25 30
30 20 25 3 5 2 15
5
10 5
Table 6 Data 1988, referential budget, 50 dobras (reference diet ⴝ D3) Diet
Energy (1000 cal)
Protein (10 g)
D1 D2 D3 D4 D5
5.26 4.34 2.6 2.0 2.5
10.6 11.4 11.1 9.4 8.8
Table 7
Data 1991, referential budget, 170 dobras (reference diet ⴝ D3)
Diet
Energy (1000 cal)
Protein (10 g)
D1 D2 D3 D4 D5
4.0 3.4 3.0 2.1 2.8
8.1 9.0 11.5 9.9 9.7
Table 8
Data 1992, referential budget, 300 dobras (reference diet ⴝ D3)
Diet
Energy (1000 cal)
Protein (10 g)
D1 D2 D3 D4 D5
4.4 3.4 2.3 1.9 2.6
8.9 8.9 8.9 9.3 9.1
acquired in each diet. Prices used were black market prices. Those prices were considered to be the best alternative reflecting real conditions and opportunity costs. Following this procedure, the calculations were performed for 1988, 1991, 1992 and 1994. Data are presented in Tables 6–9. The variables considered were protein (measured in unites of 10 g) and calories (measured in units of 1000 calories). Considering only two variables it is possible to present vectors in R2 space. Recalling our previous discussion about methodological approach and looking at the graph
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Food security and hedonic behaviour: a case study of Sa˜o Tome´ e Prı´ncipe: B. R. P. de Carvalho Table 9
Data 1994, referential budget, 550 dobras (reference diet ⴝ D3)
Diet
Energy (1000 cal)
Protein (10 g)
D1 D2 D3 D4 D5
4.6 4.1 3.1 2.6 3.6
9.3 10.7 11.7 12.2 12.5
Figure 2 Consumer choice set for 1988
(Fig. 2), it is possible to visualise the efficient solution set from the consumer point of view. This set includes diet D1 and diet D2 or any combinations of the mentioned solutions. The diet where matabala is included (D5) clearly shows that this solution is inefficient, and should never be adopted without having negative effects in the population welfare. It should be mentioned that the first graph (Fig. 2) is built for the 1988 situation when the discussion about introducing matabala into the diet appeared as one good innovation supported by some technicians and politicians at higher levels of the administration. The market, with central government intervention, was in place until 1992, when significant food market liberalisation occurred. Food products had fixed prices and/or fixed market margins, which immediately implied (in several cases) quantitative restrictions on available products per client and also promoted the parallel markets (where free change was possible). Table 7 and corresponding graph (Fig. 3) show the situation in 1991, taking into consider-
Figure 3 Consumer choice set for 1991
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273
ation price variation among food products and changing the referential budget. The referential budget was established looking at the evolution in the cost of diet D3, which is an intermediate solution and matches more closely the real situation and the product share in the construction of food consumption indices (validation of the value was also performed looking at price indices). The budget restriction does not alter the relative position of the vectors among diets which is our main concern. Consequently the budget reference does not change the conclusions. The graph provides an immediate conclusion. Diets D1 and D3 are the possible efficient solutions, or any combination among them. Diet D5 including matabala still appeared as an interior solution, which implies an inefficient choice to the consumer. The following exercise is performed for 1992 (Fig. 4), which is the year where the main food market liberalisation occurred. It is worthwhile to examine the evolution, mainly looking at the relative position of diet D5, the only diet including matabala with a similar composition to diet D3. In 1992 the situation is significantly different (Fig. 4). The extreme solutions are now diets D1 and D4 with diet D3 becoming a clearly inefficient solution. Diet D2 is also an interior solution. Diet D5 appeared for the first time close to the consumption efficiency frontier. Finally, it is necessary to see what happened later with the regular functioning of the market. The most recent data available refer to 1994, presented in Fig. 5. The 1994 results show diet D5 as a clearly possible efficient solution regarding consumption choice. Only diet D1 can also be an efficient solution, and the consumption choice set frontier is constructed by a combination of these two vectors. Note that, assuming one well-behaved indifference curve, with preferences not clearly biased towards one of the characteristics, the preferred choice tends to be diet D5. This solution is the one that has been appointed as the correct solution, along with the opinion of experts and some politicians, at least since the end of the 1980s.
Conclusions The first main conclusion derived from data and work presented refers to the gradual improvement of diet D5, in terms of the consumption efficient choice set. This diet was the only one including a local product, matabala, with a weight of 15% on the energy requirements. Another aspect to call attention is the fact that only in 1994 did this diet appear clearly as one possible efficient solution. There is evidence that the market functioning improved the relative position
Figure 4 Consumer choice set for 1992
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Figure 5 Consumer choice set for 1994
of the local products, at least in regard to the product considered, matabala, as a rational and efficient choice. A second aspect to be taken into consideration is the fact that arguments used to improve local product consumption, which are not based on a sound economic analysis or adequate economic policy, can lead to a decrease of population welfare. This was certainly the case for people hearing the experts’ and politicians’ arguments regarding the need to improve matabala consumption, at least in immediate terms, without consideration for macroeconomic aspects. The centrally planned economy and respective regulations did not provide this incentive. The market economy provided better incentives for local consumption products (at least for matabala), along with the general economic policy prevailing in the country, after 1992 and clearly in 1994. A third aspect to consider is the usefulness of the methodology discussed in terms of market behaviour, consumption and economic policy effects on the consumer efficient choice set. In this regard it was very interesting to see what happened within a period of enormous change in terms of economic policy and economic main references, with the evolution from a centrally planned economy towards a market driven economy. Another derivation of the results presented is the danger of trying to implement solutions without full understanding of the system within which people make decisions. Along with common mistakes regarding technical solutions to solve food production problems in less developed countries within a tropical environment, trying to implement new technical solutions, consumption advice and consumption policy can also be misleading. As shown in the example given (the country case study), the promotion of matabala within the prevailing conditions in 1988–1992 would cause lower consumer welfare. In these cases, there are additional reasons to find resistance to change. The implementation of any programme to introduce a new product, even if regarded as a traditional local product by targeted people, should always consider the — economic space and efficiency in consumption choice.
References Becker, G. (1965) A theory of the allocation of time. Economic Journal 74, 493–517. de Carvalho, B. P. (1984) Importaˆncia da industrializac¸a˜o da produc¸a˜o agrı´cola, in: I Jornadas de Engenharia dos Paı´ses de Lı´ngua Oficial Portuguesa, Lisboa.
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de Carvalho, B. P. (1989a) Demand constraints and technical change, PhD thesis, University of Minnesota. de Carvalho, B. P. (1989b) Industrializac¸a˜o da Produc¸a˜o Agrı´cola: Impacto e Interacc¸a˜o com o Desenvolvimento Agrı´cola, Conselho Nacional do Plano, Lisboa. de Carvalho, B. P. (1995a) Polı´tica Alimentar e Desenvolvimento Econo´mico em S. Tome´ e Prı´ncipe, Instituto de Investigac¸a˜o Cientı´fica Tropical, Se´rie de Cieˆncia Agra´rias, no. 19, Ministe´rio do Planeamento e da Administrac¸a˜o do Territo´rio, Secretaria de Estado da Cieˆncia e Tecnologia, Lisboa. de Carvalho, B. P. (1995b) Programas de Ajustamento Estrutural, Polı´tica Econo´mica e Produc¸a˜o Agrı´cola, Associac¸a˜o Portuguesa das Jornadas de Engenharia, Guine´-Bissau and Inst. Sup. de Agronomics, SATS 1(4), Lisboa. de Carvalho, B. P. et al. (1995) Estudo de Oportunidades para as Empresas Portuguesas, Associac¸a˜o Industrial Portuguesa, Lisboa. Collantoni, C. S., Davis, O. A. and Swaminuthan, M. (1976) Imperfect consumers and welfare comparisons of policies concerning information and regulation. Bell Journal of Economics 7, 602–615. Deaton, A., Muellbaker, J. (1986) Economics and Consumer Behavior. Cambridge University Press, Cambridge. Delgado, C. L. and Miller, C. P. J. (1985) Changing food patterns in West Africa: implications for policy research. Food Policy 10, 55–62. Donovan, G. (1987) Broadening production increase programs to reach low-income farmers, in: J. P. Gittinger et al. (Eds.), Food Policy: Integrating Supply, Distribution and Consumption, EDI Series in Economic Development, World Bank, Johns Hopkins University Press, Baltimore and London. Ennes Ferreira, M. (1990) Pobreza absoluta e desigualdades sociais, ajustamento estrutural e democracia na R.D. Sa˜o Tome´ e Prı´ncipe. Revista Internacional de Estudos Africanos 12, 137–166. Gittinger, J. P., Leslie, J., Hoisington C. (Eds.), (1987) Food policy: Integrating Supply, Distribution and Consumption, Economic Development Institute Series in Economic Development, World Bank, Johns Hopkins University Press, Baltimore and London. Kennedy, E. T., Alderman, H. H. (1987) Comparative Analysis of Nutritional Effectivenes of Food Subsidies and Other Food Related Interventions, International Food Policy Research Institute, Washington, DC. Lancaster, K. (1966a) Change and innovation in the technology of consumption. American Economic Review 56, 14–23. Lancaster, K. (1966b) A new approach to consumer theory. Journal of Political Economy 74, 132–157. Maxwell, S. (1996) Food security: a post modern perspective. Food Policy 21, 155–170. Mellor, J. W., Johnston, B. F. (1987) The world food equation: interrelations among development, employment and food consumption, in: J. P. Gittinger et al. (Eds.), Food Policy: Integrating Supply, Distribution and Consumption, EDI Series in Economic Development, World Bank, Johns Hopkins University Press, Baltimore and London. Ministe´rio de Economia e Financ¸as (1994) Evoluc¸a˜o Recente da Situac¸a˜o Econo´mica e Social, Gabinete de Assessoria e Estudos, Repu´blica Democra´tica de Sa˜o Tome´ e Prı´ncipe. Ministe´rio do Plano e Financ¸as (1995) Direcc¸a˜o de Estatı´stica, Dados Estatı´sticos Respeitantes ao Ano de 1994, Repu´blica Democra´tica de Sa˜o Tome´ e Prı´ncipe. Tschirley, D., Donovan, C. and Weber, M. (1996) Food aid and food markets: lessons from Mozambique. Food Policy 21, 189–203. World Bank, Poverty and Hunger: Issues and Options for Food Security in Developing Countries, World Bank Policy Study, World Bank, Washington, DC, 1986.
Pergamon
PII: S0306-9192(98)00034-7
Food security and hedonic behaviour: a case study of Sa˜o Tome´ e Prı´ncipe Bernardo R. P. De Carvalho* University of Lisbon, ISA, Tapada da Ajuda, 1300 Lisboa, Portugal Food security is still one of the main concerns in economic policy making in less developed countries. The objective of the present study is to analyse technological innovation and technological change induced by economics forces, with special attention to consumer behaviour. Consumer choice is studied together with the technological change process from the consumption side, such that efficiency problems can be handled if a certain number of weak assumptions can be accepted. The framework of the Lancaster model is used to study the impact on food security on Sa˜o Tome´ e Prı´ncipe, changing from a centralised economic policy to a market oriented economy. The paper addresses the need to understand how consumption innovation with the introduction of locally produced food consumption can be an efficient solution from the consumption point of view. The results obtained with the introduction of matabala into the consumption choice set show that free market functioning supports local products consumption as an efficient solution in Sa˜o Tome´ e Prı´ncipe. 1998 Elsevier Science Ltd. All rights reserved. Keywords: food security, hedonism, Sa˜o Tome´ e Prı´ncipe
Introduction The need to define a consumption technology, given that consumption efficiency can be studied and introduced into policy discussion, is one of the central aspects in the analysis of consumption and market behaviour. On the other hand, production technology is becoming only one of the factors, among others, in food production and food processing industry where market behaviour and organisation factors are, at least, of equal importance for a successful production system. Production technology was, until recently, almost always the dominant concern in solving food supply problems. Food security concern was, until the end of the 1970s, dominated by production technology constraints at the world level. Since then, food surpluses have been a constant problem in industrialised economies and food supply, at world level, not a relevant issue. The evolution of the economic development thought shows that food systems are the key to the understanding of food security problems (Gittinger et al., 1987). Indeed, the concept of food security, to a certain degree substituting the self-sufficiency goal in less developed countries, was developed
*Present address: Av. da Republica, no. 27-7, 1050 Lisboa, Portugal. Tel.: ⫹ 351 1 364 9858; Fax: ⫹ 351 1 352 3799
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and applied to take into consideration all factors from which good nutrition and food satisfaction are derived. The food security equation is established looking at two different sides, supply and demand driven factors. The economic development field, looking at structural changes of the economies in different development stages, and also identifying economic policies that can accelerate desired changes, provides a very clear picture of the structural economic forces that conditioned the food security equation at the national level. At least three different stages can be identified regarding the food security equation (that is, the supply – demand balance): Phase I, relative equilibrium based on natural resources sustainability; Phase II, excess demand driven by a fast population growth and industrialisation process; and Phase III, excess supply driven by a static population and food demand and a strong institutional capability to provide technology and productivity growth. As argued by Mellor and Johnston (1987, p. 47), ‘the first phase is rough parity of domestic supply and demand with real food prices constant except for sharp year to year, weatherinduced fluctuations’. In this phase low income countries are isolated from the global international environment, prior to the acceleration of their growth rates, either in population and/or production. The equilibrium between supply and demand is obtained based on natural resource use and availability. The second phase is characterised by a sharp population increase, a stronger industrialisation and openness to the world environment either in technology and/or capital. Today this phase is probably the most frequent among less developed countries, since there are almost no examples of complete isolation (the same cannot be said in regional terms) and natural equilibrium between supply and demand. The population growth, either through less child mortality and expansion of life expectation at birth and/or through increases in the fertility rate, tends to achieve levels above 2.5%. Considering the income effect expected in a rapid economic increase process, which characterises the initial phases of the industrialisation process, the food demand growth tends to be at least 4%. To guarantee an equilibrium in the food balance equation, food supply would have to increase at least at the same rate, which turns out to be a difficult goal (on a sustainable base) for a great number of less developed countries. As a consequence, those countries, in the specified phase, tend to increase food imports. The third phase is characterised by a stagnation of food demand and continuous production increase, driven by a strong research base and continuous tendency to improve factor productivity. This phase characterises the industrialised world in general, with slow or even close to zero population growth and continuous increase of supply, leading, in several known cases, to food exports and/or accumulation of surplus. Many countries in sub-Sahara Africa are now in the second phase. Some of them are also adopting structural adjustment programmes, in general changing from centrally planned economies to more open and market oriented economies. It is essential to study the results of such programmes on food security, including effects on production and consumption systems and respective sustainability. With the development process, changing food patterns in Africa have been studied by several authors, showing great pressure on increasing food imports (for example, Delgado and Miller, 1985). Of great concern is the increasing consumption habits of products which are not produced locally and/or cannot be adapted to local production conditions. Food aid is another factor which requires explicit attention to the effects on food markets. Several studies show the negative consequences of food aid on food production systems (Gittinger et al., 1987). A
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recent work by Tschirley et al. (1996) in regard to food aid in Mozambique (one of the most food aid-dependent countries in the world) points out the problematic effects, mainly in regard to white maize production and marketing system. In this paper, following a brief discussion on methodological issues, a country case study is presented using a specific simple method to study consumption behaviour and consumption efficiency. Local food products (matabala as an example) and competing imported foods are studied in terms of consumption choice and consumer efficiency in respect to changes in economic policy (from a centrally planned economy to a market oriented economy). A literature review on production technology and consumption technology is given in the next section. The Lancaster model and its derivations are given afterwards (third section). A case study of local foods and consumption eficiency in Sa˜o Tome´ e Prı´ncipe is given in the fourth section. Conclusions of the study form the final section.
Production technology and consumption technology The term ‘technology’ has been used mainly as linked to the identification of production processes and respective changes linked to technological or scientific knowledge. More recently and less frequently the term appears associated with consumption processes. Lancaster (1966a); Lancaster, (1966b)) is probably one of the first authors to use the term in association with the consumption process. The model developed provided an analytical structure that allows the introduction of the notion of consumption efficiency. Production and consumption can almost be viewed as a dual problem where the final denominator is the generation of utility. Indeed, the definition of production adopted is given in the following way: production is any process resulting from any given human activity, involving more than one input and aiming to create utility. As a corollary we can say that production always involves the notion of consumption since the generation of utility directly or indirectly is associated with an human element (a consumer). On the other hand, consumption activity always involves the notion of production, since consumption is a transformation process of goods and services into utility. Viewed through that analogy, the production process traditionally defined in terms of goods (in the first phase), services also (in a second phase) can now be viewed in terms of utility (which will be considered a third phase). The production process is transformed into a sequence of activities, a sequence of processes, in which the last linkage is the production of utility at consumer level. Household production theory is generally known by incorporating into models of household behaviour special assumptions, allowing an integration of the consumer’s theory with that of the firm. This approach is relevant to household decision making concerned with the efficient use of market goods, time and human capital. It is assumed that household obtains utility from some underlying goods that cannot be bought in the market but are instead produced in the household from inputs of market goods, time and human capital. Deaton and Muellbaker (1986, p. 247) clearly state: ‘In some contexts, the household production approach is not merely a clever or elegant way of looking at household decisions but the only appropriate way.’ Following this rational, it is of interest to look at the ‘inputs’ within the consumption activity. It is well known that utility cannot be measured in cardinal terms, but only in ordinal sequence. As a consequence, the last linkages in the consumption activity between goods and utility cannot be measured, unless we introduce another intermediate step, that is, the production of attributes/characteristics that can be measured. As a corollary we can say that each good or service can be evaluated in quantitative terms regarding some well-defined characteristics, and
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a residual term not well specified and/or not susceptible to quantification. In this situation it is assumed that the consumer has a preference order regarding attributes and characteristics solving a maximisation problem. In other words, it is possible to define an utility function, which arguments are the attributes, or sets of attributes, with a residual term, accounting for unknown variables or non-measurable variables. A central point to the analysis is the necessary condition of having common attributes in several goods/or services that can be measured.
Lancaster model and derivations This section is included to help explain and summarise the basic ideas. The model to be used is based on the methodology developed by Lancaster during the 1960s. The consumer is assumed to have a preference ordering over all possible characteristic sets (defined in vectorial terms) subject to a budget constraint, such that preference ordering is mainly established across characteristics, usually defined in vectorial terms. The consumer’s demand for goods and services can be viewed as a derived demand. Indeed, goods and services are ‘inputs’ to obtain desired characteristics/attributes. One of the most important features of the model refers to the fact that several goods/services have the same type of characteristics or, in other words, there are several characteristics in common in several goods/services. On the other hand, the substitution possibilities in consumption between goods, between services and also between goods and services are typically nonlinear, but the substitution possibilities among common characteristics in several goods/services are perfectly linear. The utility function can be defined in terms of n characteristics, in which n – m are common characteristics to several goods/services, where m are the specific characteristics of the goods/services. The number of goods/services is similar to or greater than m, which means that some goods/services might have no specific characteristics, including, for example, specific image on the market. With this structure and assumptions in mind it is possible to foresee the possibility of obtaining the same set of characteristics with different combinations of goods/services. These possibilities allow the introduction of the notion of efficiency in consumption, and the study of consumer options. The revealed preferences with the choices of goods/services also allows one to study and identify the specific characteristics of each good/service, looking at residual attributes and respective value. When there is no doubt about common characteristics that can be obtained with the consumption of different goods, and the specific attributes have no relevant weight (are not dominant) the preferences and consumer choice can be evaluated in terms of efficiency. Consider the following example (Fig. 1) with one consumer within a world with two goods (a and b) and two different characteristics (C1 and C2). Consider that each good has the two different characteristics and no specific attribute. Consider the space R2, with C1 and C2 coordinates. Each good can be represented by a vector in this space. Let’s assume that the consumer wants to choose or has a preference order for the specified C1 and C2 characteristics such that an indifference curve can be established. Assuming also a budget restriction, the figure below shows the possible consumption set and the efficient possible solutions represented by the vectors (a and b) and the possible combinations of these vectors. The efficient frontier is represented by a and b points and the line between the vectors. Any other solution is
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Figure 1 Consumer choice set, with two goods and two different characteristics
inefficient in the sense that it is always possible to obtain the same quantities of one characteristic improving the consumption of the other within the same budget restriction. The indifference curves are not drawn, but the preference ordering among characteristics can be studied without problems looking at the choice set and any possible well-behaved preference order. The maximisation set will include the line between the two vectors and the extreme points a and b. The introduction of a new good can be studied with great interest in terms of the specific contribution and/or in terms of enlargement of the efficient consumption set. If this new good has no specific attribute and can also be translated in terms of the common characteristics C1 and C2, depending on the price and specific contents of the characteristics, the new good will provide a new alternative to the consumer, but not necessarily improve the efficient consumption set. As a corollary to this rational, the simple model presented provides a structure with great interest in marketing research and also in terms of product innovation.
Case study of local foods and consumption efficiency in Sa˜o Tome´ e Prı´ncipe The model can be useful to study the food system and nutritional conditions, regarding consumption efficiency. For less developed countries in rapid structural changes the model discussed is of great interest. Another area of interest to apply the model to is the food system and nutritional issues. The nutritional efficiency problems in low income countries are crucial. The consumption capability available to the most part of the population does not justify the existence of ‘luxury goods and/or luxury characteristics’, that is, people are concerned to satisfy basic needs. Some times, as it is well known, habits, cultural background, and specific tastes can introduce restrictions in terms of transforming available food supply in common characteristics, which are, in nutritional terms, the basic nutrient contents. There is always the possibility to account for the specific attributes, for example, introducing a specific value percentage in terms of the price of the good, such that we can do the transformation of the good into common and specific characteristics. The application of the analytical model discussed is performed for a less developed country, Sa˜o Tome´ e Prı´ncipe. This country has an insular structure with two main islands, localised in the Gulf of Guinea, off the West coast of Africa, around 300 km from the Gabonese coast. Sa˜o Tome´ e Prı´ncipe is a country with an area of 1001 km2, divided into two main islands
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(860 for Sa˜o Tome´ and 140 km2 for Prı´ncipe). The rest of the country is divided into uninhabited small islands. The population is around 130,000 inhabitants, 6000 of them on the island of Prı´ncipe. The official language is Portuguese and the majority of the population are Roman Catholic. The climate is equatorial, warm and humid, with average temperatures ranging from 22° to 27°C. Annual rain fall varies from 800 mm in the North to more than 2000 mm in the South. Today there is a Parliamentary democracy. A former Portuguese province, Sa˜o Tome´ e Prı´ncipe, became an overseas province in 1951 and received local autonomy in 1973. Following the military coup in Portugal in April 1974, the Portuguese government recognised the right to independence. The economic policy, following independence, was dominated by a centrally planned perspective, with nationalisation of the main firms and farms. The country’s economy was dominated by cocoa plantations and cocoa exports. The cocoa exports achieved around US$30 millions at its maximum. This small country was, at some point in the past, the first cocoa producer in the world. At the independence the exports of cocoa were around US$10 million but decreased afterwards until recently. The political options taken by Sa˜o Tome´ e Prı´ncipe’s government began to change during the 1980s. The changes were on the direction of more liberal economy but the process took several years. The changes in the international political environment also helped to speed up this process. Under the 1990 Constitution, legislative power is vested in the National Assembly, which comprises 55 members, elected by universal suffrage for a term of 4 years. The President is elected by universal suffrage for a term of 5 years. The most significant changes in economic policy were performed after 1992. In 1992, according to the World Bank, the country gross national product (GNP) measured at 1990–1992 average prices, was US$44 million. In per capita terms the value estimated was US$370 per head. The population growth rate is estimated to be above 2%. Until 1987 the GDP decreased. The country didn’t have problems with balance of payments until 1980. Between 1980 and 1985 the economic situation deteriorated and the current balance account shifted from a surplus of US$7 million to a deficit of US$10 million. This situation led to the need of establishing a structural adjustment plan with the intervention of the World Bank and IMF. The economic situation improved with positive growth rates in most years after 1987 but still with an average growth below 2% (which still implies a per capita income decrease, unless population growth decreases significantly). The country received substantial aid in several forms from the international community. Food aid has been one of the main components of the international intervention linked with investment programmes, such as food for work and cocoa farms’ rehabilitation programmes. In food supply the country has an enormous dependence from imports, which are in great part obtained through donations. Generally, more than 50% of food consumption has been dependent on imports. Family consumption data (per week and for an average household size of four to five persons), presented in Table 1, shows the main imported food products. Palm oil is included because it is a close substitute for imported oil. There are other products that are important in the food consumption habits of the population of Sa˜o Tome´ e Prı´ncipe, such as fish, banana and more recently taro, known locally as matabala, all of them with local origin. It is not difficult to conclude that food aid and other external influences have been reducing the use of local products in the diet of the people. At least, it is consensual to say that food aid did not help adequate food consumption to local resources and local production potential. According to theory, consumption is much lower for the low income group. To test and
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Table 1 Average food consumption (kg or defined unity) per week and family, for several imported foods Food product
Total
60% higher income
40% lower income
Wheat flour Corn flour Rice Sugar Beans Palm oil Imp. vegetable oil Milk (power) Bread (unites of 10 g)
1.32 2.01 3.71 2.27 1.36 1.94 1.42 2.09 57.31
1.54 2.30 4.33 2.64 1.56 2.04 1.69 2.59 69.59
0.89 1.57 2.79 1.73 1.03 1.80 1.00 1.26 38.89
Note: Inquiry realised in S. Tome´ city (April, 1992). Table 2
Apparent consumption, 1988 – 1991, for several imported products (metric tonne)
Product
1988
1989
1990
1991
Wheat Rice Sugar Beans Vegetable oil Milk (powder)
2547 4603 1072 905 487 407
4901 3336 1214 1209 1457 189
4110 2179 1949 806 499 95
1675 3675 1086 942 358 362
Source: PNUD in S. Tome´ e Prı´ncipe and Ministe´rio de Economic Development e Financ¸as (1994, 1995).
validate the results, ‘apparent consumption’ was calculated based on disappearance, assuming no variation in stocks (Table 2). The problems of market supply based on imports (mainly donations) implies great variation in consumption. Commercial imports only recently began to be done by private entrepreneurs. The problems resulting from the small dimension of the market and the insular structure of the country make any stock management difficult and transport cost a key factor to be considered. Food imports are based on donations (biggest share) and marginal commercial transactions (Tables 3 and 4). Donations, unfortunately, tended to be very erratic, difficult to plan and not sustainable in a permanent way. Several authors and politicians have pointed out the urgent need to improve food security at the country level, promoting local production and better use of local resources. One important local resource is the use of native species that grow spontaneously, like matabala. Table 3 Imported food supply: donations and commercial imports (metric tonne)
Cereals Non-cereals
1988
Food donations 1989 1990
1991
1988
7175 1489
7895 3381
6861 1560
2372 1615
7259 1751
Commercial imports 1989 1990 2500 1765
1000 2480
1991 50 1846
Source: PNUD in S. Tome´ e Prı´ncipe and World Bank consultants. Note: Cereals include wheat flour, rice, and corn flour; non-cereals include beans, vegetable oil, power milk, fish, meat, sugar and salt.
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Food security and hedonic behaviour: a case study of Sa˜o Tome´ e Prı´ncipe: B. R. P. de Carvalho Table 4 Relative importance of food aid, in relation to total imports (percentage)
Cereals Non-cereals Total food aid Total imports
1988
1989
1990
1991
75 48 69 100
76 66 73 100
88 41 72 100
99 46 82 100
Source: author elaboration.
Ennes Ferreira (1990) provided a good discussion of the effects of matabala introduction into the diet. The study focus was poverty (level of absolute poverty) and the structural adjustment effects in the general population of the country. De Carvalho (de Carvalho, 1995a, b) also refers to this product and potentialities, explaining the good characteristics, which include being used for local food intake and also for export into regional markets, like Libreville (Gabon). Indeed, it was estimated that exports of matabala already achieved 20% of the value of cocoa exports, based on CLUSA (US Coop. League working as a non-governmental organisation) information and author estimations. The work performed by Ennes Ferreira (1990) provided the starting point of our analysis, using a similar structure in terms of the diets chosen and also questioning the effects of introducing matabala as a new product to improve welfare of the people. The economic policy, the structural adjustment programme effect and the study of the consumption efficiency regarding several consumption choices (market behaviour) are the core of the problems to be addressed. The main hypotheses considered were the following: (1) considering the gradual economic policy change, with the evolution from a typical centrally planned economy to a market economy, the market has been functioning (or not) promoting a gradual change in the population food consumption habits; (2) assuming that market functioning is reasonable, prices should reflect the relative scarcity of the products (including hard currencies), such that imported products should tend to have higher prices than local products; (3) the efficient consumer, if the conditions mentioned above hold, will tend to change in the direction of higher consumption of local products, such as matabala; and (4) the intervention of any institution or governmental campaign, through better information and education, trying to increase local products consumption might have no success or induce worse off situations to the general population if there is no adequate economic policy, namely, assuring the good functioning of the market. The methodology consisted of establishing four different diets (D1–D4), based on the habits of the people and increasing the diversification from D1 up to D4 (Table 5) and using the reference composition of the product set utilised in the calculation of the consumption price index. The products included were rice, beans, corn, oil, fish, and meat. The set of products and respective quantities in each diet was calculated having a minimum requirement of 3050 calories. Then, a new diet, ‘D5’, was considered, adding matabala in the consumption set with a 15% energy weight. Taking the reference of 3050 calories to be obtained with each diet, quantities of each food product and respective cost can be calculated. Establishing a referential budget per year, and taking into consideration the composition of the different diets, it was possible to calculate the quantities of protein and energy to be
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Table 5 Diet composition in % of calories Food product
D1
D2
D3
D4
D5
Rice Beans Corn Oil Fish Meat Matabala
90 5
75 13 5 5 2
50 25 15 3 5 2
30 25 30
30 20 25 3 5 2 15
5
10 5
Table 6 Data 1988, referential budget, 50 dobras (reference diet ⴝ D3) Diet
Energy (1000 cal)
Protein (10 g)
D1 D2 D3 D4 D5
5.26 4.34 2.6 2.0 2.5
10.6 11.4 11.1 9.4 8.8
Table 7
Data 1991, referential budget, 170 dobras (reference diet ⴝ D3)
Diet
Energy (1000 cal)
Protein (10 g)
D1 D2 D3 D4 D5
4.0 3.4 3.0 2.1 2.8
8.1 9.0 11.5 9.9 9.7
Table 8
Data 1992, referential budget, 300 dobras (reference diet ⴝ D3)
Diet
Energy (1000 cal)
Protein (10 g)
D1 D2 D3 D4 D5
4.4 3.4 2.3 1.9 2.6
8.9 8.9 8.9 9.3 9.1
acquired in each diet. Prices used were black market prices. Those prices were considered to be the best alternative reflecting real conditions and opportunity costs. Following this procedure, the calculations were performed for 1988, 1991, 1992 and 1994. Data are presented in Tables 6–9. The variables considered were protein (measured in unites of 10 g) and calories (measured in units of 1000 calories). Considering only two variables it is possible to present vectors in R2 space. Recalling our previous discussion about methodological approach and looking at the graph
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Food security and hedonic behaviour: a case study of Sa˜o Tome´ e Prı´ncipe: B. R. P. de Carvalho Table 9
Data 1994, referential budget, 550 dobras (reference diet ⴝ D3)
Diet
Energy (1000 cal)
Protein (10 g)
D1 D2 D3 D4 D5
4.6 4.1 3.1 2.6 3.6
9.3 10.7 11.7 12.2 12.5
Figure 2 Consumer choice set for 1988
(Fig. 2), it is possible to visualise the efficient solution set from the consumer point of view. This set includes diet D1 and diet D2 or any combinations of the mentioned solutions. The diet where matabala is included (D5) clearly shows that this solution is inefficient, and should never be adopted without having negative effects in the population welfare. It should be mentioned that the first graph (Fig. 2) is built for the 1988 situation when the discussion about introducing matabala into the diet appeared as one good innovation supported by some technicians and politicians at higher levels of the administration. The market, with central government intervention, was in place until 1992, when significant food market liberalisation occurred. Food products had fixed prices and/or fixed market margins, which immediately implied (in several cases) quantitative restrictions on available products per client and also promoted the parallel markets (where free change was possible). Table 7 and corresponding graph (Fig. 3) show the situation in 1991, taking into consider-
Figure 3 Consumer choice set for 1991
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273
ation price variation among food products and changing the referential budget. The referential budget was established looking at the evolution in the cost of diet D3, which is an intermediate solution and matches more closely the real situation and the product share in the construction of food consumption indices (validation of the value was also performed looking at price indices). The budget restriction does not alter the relative position of the vectors among diets which is our main concern. Consequently the budget reference does not change the conclusions. The graph provides an immediate conclusion. Diets D1 and D3 are the possible efficient solutions, or any combination among them. Diet D5 including matabala still appeared as an interior solution, which implies an inefficient choice to the consumer. The following exercise is performed for 1992 (Fig. 4), which is the year where the main food market liberalisation occurred. It is worthwhile to examine the evolution, mainly looking at the relative position of diet D5, the only diet including matabala with a similar composition to diet D3. In 1992 the situation is significantly different (Fig. 4). The extreme solutions are now diets D1 and D4 with diet D3 becoming a clearly inefficient solution. Diet D2 is also an interior solution. Diet D5 appeared for the first time close to the consumption efficiency frontier. Finally, it is necessary to see what happened later with the regular functioning of the market. The most recent data available refer to 1994, presented in Fig. 5. The 1994 results show diet D5 as a clearly possible efficient solution regarding consumption choice. Only diet D1 can also be an efficient solution, and the consumption choice set frontier is constructed by a combination of these two vectors. Note that, assuming one well-behaved indifference curve, with preferences not clearly biased towards one of the characteristics, the preferred choice tends to be diet D5. This solution is the one that has been appointed as the correct solution, along with the opinion of experts and some politicians, at least since the end of the 1980s.
Conclusions The first main conclusion derived from data and work presented refers to the gradual improvement of diet D5, in terms of the consumption efficient choice set. This diet was the only one including a local product, matabala, with a weight of 15% on the energy requirements. Another aspect to call attention is the fact that only in 1994 did this diet appear clearly as one possible efficient solution. There is evidence that the market functioning improved the relative position
Figure 4 Consumer choice set for 1992
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Food security and hedonic behaviour: a case study of Sa˜o Tome´ e Prı´ncipe: B. R. P. de Carvalho
Figure 5 Consumer choice set for 1994
of the local products, at least in regard to the product considered, matabala, as a rational and efficient choice. A second aspect to be taken into consideration is the fact that arguments used to improve local product consumption, which are not based on a sound economic analysis or adequate economic policy, can lead to a decrease of population welfare. This was certainly the case for people hearing the experts’ and politicians’ arguments regarding the need to improve matabala consumption, at least in immediate terms, without consideration for macroeconomic aspects. The centrally planned economy and respective regulations did not provide this incentive. The market economy provided better incentives for local consumption products (at least for matabala), along with the general economic policy prevailing in the country, after 1992 and clearly in 1994. A third aspect to consider is the usefulness of the methodology discussed in terms of market behaviour, consumption and economic policy effects on the consumer efficient choice set. In this regard it was very interesting to see what happened within a period of enormous change in terms of economic policy and economic main references, with the evolution from a centrally planned economy towards a market driven economy. Another derivation of the results presented is the danger of trying to implement solutions without full understanding of the system within which people make decisions. Along with common mistakes regarding technical solutions to solve food production problems in less developed countries within a tropical environment, trying to implement new technical solutions, consumption advice and consumption policy can also be misleading. As shown in the example given (the country case study), the promotion of matabala within the prevailing conditions in 1988–1992 would cause lower consumer welfare. In these cases, there are additional reasons to find resistance to change. The implementation of any programme to introduce a new product, even if regarded as a traditional local product by targeted people, should always consider the — economic space and efficiency in consumption choice.
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