Standard Food Basket

A STANDARD FOOD Basket (SFB) is a food-based variant of the poverty line measurement methodology. It is used to estimate malnutrition or hunger to determine absolute or extreme poverty. Usually the poverty line is considered as the level of income below which one cannot afford to purchase all the resources one requires to live. Different countries use different poverty lines. Some countries determine the poverty line as a fraction of the median income and mostly emphasize the relative or social content of the standard of living. Most countries have chosen a less relative concept for the poverty line where the typical methodology consists in the valuation of a standard food basket, which is based on actual expenditure patterns and the recommended calorie intake level.

Globally, however, it is more common to use only one poverty line in order to compare economic welfare levels. Generally, the poverty line is the cost of the basket of commodities that each equivalent adult in the household requires to attain a given minimum standard of living. The current poverty line, developed in the early 1960s, is considered to be the minimum dollar amount needed for individuals, couples, or families to purchase food and meet other basic needs. It was first calculated in the United States. Now it is used in many countries. In each country an SFB is defined for the average individual or for the average individual in each household. Individuals are classified on the basis of the households to which they belong.

It is based on diets or eating habits of the group observed in surveys of household income and expenditures. Recommended nutritional requirements in terms of age, weight and height, sex, and type of activity are important factors for an SFB calculation. The SFB uses arbitrary consumption figures, which are assumed to represent upper percentiles of the daily consumption of food items. The figures are obtained from the household surveys. Based on the surveys of household income and expenditure, the social layers with the lowest income whose purchases of food place it above the nutritional requirements are determined.

The data obtained from the surveys of households provide a list of quantities of foodstuffs that satisfy the predefined nutritional requirements of the individual. The quantities of foodstuffs are then multiplied by the prices, which in principle each household has to spend, although in practice there is usually a single range of prices or sometimes one rural and one urban. In this way the total cost of the per capita food basket is obtained.

The Standard Food Basket variant has a number of specific limitations. The procedure is not only assuming that in satisfying nutritional standards the selected group should also satisfy the rest of their basic needs, but also assuming what should be the result of the measurement exercise: that this population group is not poor. Further issues arise in measuring household living standards. The choice between income and consumption as a welfare indicator is one issue. Incomes are generally more difficult to measure accurately, and consumption meshes better with the idea of the standard of living than does income, which can vary over time even if the standard of living does not. But consumption data are not always available, and when they are not, there is little choice but to use income.

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