Does globalization change the dynamics between food prices and nutrient intake? Implications of price elasticities of child nutrient intakes for food policy in rural Mexico

Globalization is claimed to reduce food prices and can improve nutrition if consumers choose higher quality diets in the long run. In short term, however, appropriate policies are needed to ensure adequate food intakes for the poor against market shocks. As a requirement for NAFTA, the Mexican government ended tortilla price regulation in late 1998, with the national price increasing subsequently. This study used data from 828 children in 6 states in Mexico from 1998 and 1999 to test if children's daily intake of nutrients became more sensitive to prices after the policy change. The slopes for demand of 11 nutrients in response to prices of 12 staple foods (change in a nutrient intake due to a % change in price of a food) were tested for differences across years. In 1999 (vs. 1998), increase in price of chicken was more likely to decrease intake of protein (regression coefficients for 1998=−6.63, 1999=−11.38, p=0.04), iron (−6.76 vs. −9.54, p=0.03), and calcium (−2.44 vs. −4.74, p=0.04). Increase in price of tomato was associated with a larger shift toward fat intake in 1999 compared to 1998 (4.13 vs.12.5, p=0.04). The slopes were not significantly different for the effects of price of tortilla or any other food items on nutrient intakes. We conclude that price regulation policies for chicken and tomato as two main foods in children's diet could possibly have better protected their intake during the globalization process in Mexico.