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Amartya Sen's famine philosophy

Sen has given entitlement status to food, because this is the first basic necessity of life. However, what creates confusion in his articulation is the assertion that everyone must be allowed to acquire food at the price they can afford. Perhaps Sen's entitlement approach, which has become legendarily popular, needs more critical evaluation.

KHANDAKAR QUDRAT-I ELAHI
AMARTYA Sen, a 1998 Nobel laureate, is described by his colleagues as the "conscience of the profession." This reputation and recognition is bestowed for his contribution toward humanising capitalism, often described as "economic growth with human face." And this humanising idea has found the clearest articulation in his famous book, Poverty and Famines: An Essay on Entitlement and Deprivation, published in 1981. Here Professor Sen offers an innovative explanation of the causation of famine.
Although the idea has inspired huge literature on hunger, starvation, and famine, dramatically influenced the policies of the international donor community, and led eventually to the coinage of new development terminologies, the public are still ill-informed about the true nature and worth of Sen's famine philosophy. In this short space is made an attempt to present this popular philosophy in ordinary English for the general readers.
Entitlement approach
Famine refers to a socio-economic situation in which people starve on a mass scale and many of them die from starvation or starvation related diseases. Since, natural or human-made disasters adversely affecting the flow of food supply precede the creation of this situation, famines are traditionally described by shortage of food supply. Sen calls this traditional explanation the "Food Availability Decline" explanation, which is more popularly known by its acronym FAD.
Experience, however, shows that famines might occur in all food supply situations -- inadequate, normal, or boom. An example is the 1974 famine of Bangladesh, in which food prices skyrocketed although, in Sen's estimate, there was no visible "food availability collapse."
Thus, by Sen's argument, FAD is just one explanation of this human tragedy, meaning that the traditional approach fails to provide a "general theory" of the process causing famine.
The entitlement approach to famine is this missing general theory. The line of logic goes as follows: Food ownership is one of the most primitive property rights. In the noncommunist state, economic exchanges, which allow food acquirement though trade, preserve and protect this right. Therefore, individuals' failure to acquire food through exchange or trade is tantamount to exchange entitlement failure. Since everything is taking place under the ordinary laws of the land, the failure in exchange entitlement implies social deprivation.
This is the gist of Amartya Sen's innovative idea about the causation of famine. However, for appreciating its true worth, we must comprehend the connection among its key concepts, which include food ownership and entitlement, income and exchange.
Food ownership and entitlement, endowment and market exchange
The word, entitlement, implies the possession of "legal title" of something. When someone possesses legal title to anything, he/she becomes its owner. Thus, the ideas of entitlement and ownership
are inseparable.
In Sen's argumentation, food ownership is a kind of entitlement relationship, because it is one of the most primitive property rights. This proposition is pivotal in the formulation of Sen's entitlement approach: Acquiring adequate food is a fundamental property right (!). To ensure that individuals are able to enjoy this right, they must be given legal title in the acquirement process. And this is entitlement.
During famine, individuals starve, because they cannot afford food at the prevailing prices. Sen's concern is: "People died because they didn't have the income to buy food, but how come they didn't have the income? What they earn depends on what they can sell and at what price, and starting off with incomes leaves out that part of the entitlement picture."
This is the pivotal point in the entitlement approach: Individuals must be allowed to buy food at the prices they can afford, and the prices they can afford depend upon the income they receive from employing the assets they own, including their labour power. Why? Because, food is an entitled commodity. When individuals cannot buy food and for that reason suffer starvation, their food entitlement is violated, meaning that they have been deprived. A conservative commentary
Against this backdrop of blessings mentioned above, some critiques that have right away rejected Sen's famine philosophy. For example, an Indian economist is reported to have remarked: "What Professor Sen has said about famine, was known to my grandmother."
Such is the nature of controversy clouding Sen's famine philosophy. And it is by no means an easy job to comment on this huge issue. One reason is that Sen, in articulating this path-breaking analysis, has combined four aspects of the noncommunist state -- social, legal, political, and economic. However, four comments are made below that cover all these issue.
Food price behaviour
The inspiring idea behind entitlement approach is that the FAD is a partial explanation of the causation of famine. This is because skyrocketing food prices in the absence of visible decline in food availability caused famines in the past. And Sen suggests the entitlement approach as a "general framework for analysing famines."
Naturally, Sen's famine philosophy will lose intellectual appeal if the traditional framework can explain the famine occurrence under all food supply situations. And a closer look into the economics of agriculture and food would show that it is perfectly capable of explaining price situations during famines.
First, both demand and supply elasticities of food are highly inelastic, which means that a small change in either demand or supply will cause more than proportionate change in prices. Second, perhaps more important, producers and market intermediaries operate on expected prices, not actual prices. Naturally, any event like natural disaster adversely affecting supply increases the prospect of higher future prices and by that causes market prices to increase. In case of flood damaging food crops, two factors collude to make the situation worse. Firstly, the decrease in supply causes prices to rise. Then because the demand is inelastic, market intermediaries take full advantage of this shortage phenomenon. Thus, even though natural disasters might have caused little damage to total production, food prices increase disproportionately. On the other hand, the total, and/or per capita, food availability might be higher during famine than normal years, because higher prices attract higher supply. Thus, higher food prices, which follow some kind of natural or human-made food crises, are quite normal in market economy.
This is the economics of food price fluctuations in market economy, popularly known as capitalism. Since Sen's articulation of the entitlement approach is founded upon posterior demand and supply situations, it ignores one of the most important economic facts about market economy: short-run commodity
prices are basically determined by the speculative demand and supply forces. Information about food demand is known with some degree of certainty, meaning that speculative supply is basically responsible for spiralling food prices during famines. In other words, the traditional approach indeed gives the intuitive as well as logically valid explanation of food prices during famines -- irrespective of the actual supply situation.
Food ownership in capitalism
Sen's entitlement approach seems to contradict the principles of market economy. The foundation of all economic theory is the perception of voluntary exchange, which is again based on self-interest. Consumers' behaviour is guided by the principle of maximising utility, while producers' actions are propelled by prospect of maximising profit. In other words, voluntary transactions are the basis of economic exchange in market economy. Therefore, Sen's entitlement approach contradicts the very foundation of economic theory. What is really strange is that he has used this conventional economic theory to develop his entitlement approach.
Assignment of entitlement status
Sen has given entitlement status to food, because this is the first basic necessity of life. However, what creates confusion in his articulation is the assertion that everyone must be allowed to acquire food at the price they can afford.
Let's agree with Sen on this point and carry the analysis a bit further. Suppose an individual is diagnosed as a heart patient and needs a substantial sum of money for the surgery that can put her back to normal life. However, she cannot afford the cost of surgery. Does this mean that she is not entitled to have the heart surgery that can save her life? The heart surgery facility is in adequate supply in the country.
Subsistence wage theory In the 18th and early 19th centuries, economists developed a theory of wage, which is popularly known as the subsistence theory of wage determination. This theory says that long-run wages are determined at the bare subsistence level, i.e., the labourers would get just enough wages to subsist and survive.
Apparently Sen has invoked this long abandoned theory of wage determination in developing his entitlement approach. In those days, government was little concerned with public welfare, let alone people's health and education. Accordingly, economists were concerned with the most important issue of labour economics -- setting wages that will make labourers physically well enough to work for their masters. Sen has not changed this subsistence notion in articulating the entitlement theory in this era of democracy, human freedom, and globalisation.
Perhaps Sen's entitlement approach, which has become legendarily popular, needs more critical evaluation.
Khandakar Qudrat-I Elahi teaches at BRAC University.