Generosity of food security programs and expected poverty: evidence from variation across Indian states

The debate over whether food security legislation should follow a targeted approach or aim for universalization persists due to lack of empirical evidence on relative redistributive impacts on the poor. Utilizing a geographic regression discontinuity design, I analyze this question in the context of the world’s largest food security program, the Indian Public Distribution System. A more universal approach to food security reduces the average household’s probability of becoming poor significantly over a strictly targeted approach, by affecting their long term planning to improve living standards through more efficient resource and time allocation. The driving force behind the higher benefits under a universal system is lower errors of excluding eligible households. The impacts on malnutrition are also significantly positive for a more generous system.