Food as a Necessity Good and Food Subsidies.

In this article, we extend a benchmark model to allow for a non‐welfarist social welfare function (SWF) that treats food as a necessity good rather than a regular good, while preserving the assumption that individuals are rational. We show that the widespread use of food subsidies by governments wor...

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Publicado en:Kyklos Vol. 78; no. 4; pp. 1457 - 1463
Autor principal: An, Zhiyong
Formato: Artículo
Publicado: Wiley-Blackwell Nov2025
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Acceso en línea:Ver este registro en EBSCOhost
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        atl: Food as a Necessity Good and Food Subsidies.
      aug:
        au: An, Zhiyong
        affil: World Bank, Washington DC, , USA
      su:
        Subsidies
        Basic needs
        Income redistribution
        Public welfare
        Consumption tax
        Agricultural subsidies
        Groceries
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        subj:
          Subsidies
          Basic needs
          Income redistribution
          Public welfare
          General-line food merchant wholesalers
          Emergency and Other Relief Services
          Other Individual and Family Services
          Health and Welfare Funds
          Administration of Human Resource Programs (except Education, Public Health, and Veterans' Affairs Programs)
          Consumption tax
          Agricultural subsidies
          Groceries
      keyword:
        food subsidies
        necessity good
        optimal tax structure
        welfarist/non‐welfarist social welfare function
        food subsidies
        necessity good
        optimal tax structure
        welfarist/non‐welfarist social welfare function
      ab: In this article, we extend a benchmark model to allow for a non‐welfarist social welfare function (SWF) that treats food as a necessity good rather than a regular good, while preserving the assumption that individuals are rational. We show that the widespread use of food subsidies by governments worldwide for redistributive purposes can be justified by recognizing food as a necessity good in almost all societies. Specifically, (1) If food is treated as a regular good, food consumption should be neither taxed nor subsidized; (2) If food is treated as a necessity good, food consumption should be subsidized; and (3) The higher the "basic need" for food, the more heavily food consumption should be subsidized. We argue that our model provides a general theoretical framework that can also justify subsidies for other necessity goods, including essential utilities such as electricity and gas. Additionally, our model suggests that adopting a non‐welfarist SWF would result in the breakdown of the Atkinson–Stiglitz theorem.
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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