Fuelling Calorie Intake Decline: Household-Level Evidence from Rural India

In India, average calorie intake has declined even as real monthly expenditure has increased. Since cross sectional evidence suggests a positive relationship between the two variables, the trend emerges as a major puzzle. Using household-level data from four recent rounds of National Sample Survey data on consumption expenditure and a novel instrumental variable estimation strategy we find that rising expenditure on non-food items is one of the factors that has led to the calorie intake decline. We provide causal evidence for such a food budget squeeze in the case of one type of non-food item, viz. expenditures on cooking fuel.