Assessing the effectiveness of government food subsidies on rice and wheat in bangladesh: economic implications for low-income households

Abstract

Government food subsidy schemes, such as the Open Market Sale (OMS) initiative, are critical to Bangladesh's attempts to stabilize grain prices, improve food affordability, and safeguard low-income households from economic volatility. This extensive study looks into the efficiency of rice and wheat subsidy systems, with a special emphasis on their influence on food security, price stability, and endurance in disadvantaged groups. We used a mixed-methods approach, combining a stratified household survey, quantitative analysis (descriptive statistics, regression modeling, and difference-in-differences estimate), and qualitative interviews with policymakers, beneficiaries, and stakeholders. Our data show that subsidized food grain distribution considerably reduces price volatility—particularly during seasonal price peaks—while increasing calorie intake and dietary stability in low-income families. Beneficiary families have a 10% higher monthly staple intake and a 15% lower rate of extremely low food security than control groups. OMS initiatives help to improve market access and stabilize prices during economic downturns, which contributes to urban food security. However, both general subsidy programs and OMS schemes confront ongoing obstacles such as mistargeting, leakages, governance concerns, and logistical inefficiencies. Beneficiaries recognize the significance of subsidies and OMS activities during lean seasons, but they express worries about registration problems and unequal distribution. Drawing on worldwide best practices (such as India's Public Distribution System and Ethiopia's Productive Safety Net Program), the report suggests better targeting using digital technologies, the use of poverty maps, and transparent delivery methods. To summarize, while Bangladesh's food subsidy and OMS programs are vital safety nets that protect low-income populations from food insecurity and price volatility, their long-term viability is dependent on fixing systemic implementation issues. This study makes evidence-based recommendations to improve and optimize existing programs for better equity and effect.