Parental resource allocation and spillovers of milk fortification program in Mexico – a population based assessment

In Mexico, an estimated 50% of preschool children and 25% of school age children are anemic. Anemia is associated with a number of adverse health and economic consequences. The Mexican government implemented a social assistance program called Liconsa to enhance the nutritional status of low-income families by providing subsidized and fortified whole milk, especially to children under 12 years. While the efficiency and long term effectiveness of the program has been evaluated elsewhere, the study of spillovers from fortified Liconsa milk on outcomes of other household members has not been explored. In 2006, 74.8% beneficiaries of Liconsa were children and adolescents. However, evidence of spillovers to other household members is strong: 18.8% of adults aged 20-29 years, 21.8% of 30-39years and 40-49% of 20-29 years reported drinking liconsa milk the previous week. The main aim of the paper is to assess the potential externalities of this intervention on anemia (and labor market outcomes) for other household members and explore the consequences for the estimation of the effect of the project on the beneficiaries. To examine these assumptions, we analyzed individual level data from Mexico’s Encuesta Nacional de Salud y Nutricion in 2006 and assess the impact on three different groups using a fixed-effect model.