A new approach to specify additional social benefit rates for a wholesome diet in Germany

Peer-reviewed | Manuscript received: August 15, 2013 | Revision accepted: November 07, 2013

Question and objective

Current Unemployment Benefits II (ALG II) regulations in Germany lay down that the payment for nutrition will not be increased when nutrition is switched to a more wholesome diet for medical reasons (e.g. allergies, diabetes, AIDS etc.).

This decision was based on calculations using the “shopping basket method”, in which prices are assigned to items in a shopping basket of food prepared by experts. However, already in the early 1990s, the shopping basket method was replaced by the so called “statistical method” for general calculations of ALG II rates in Germany. The shopping basket method requires normative specifications in detail, in contrast, the Federal Constiutional Court has reminded that a socio cultural subsistence level must be granted, which has encouraged the use of the socalled “statistical model” [1]. This model infers the need from the observed expenditure behaviour of lower income groups and thus considers actual consumption habits of the population which is in accordance with the principle of a sociocultural subsistence level.

Summary

Current Unemployment Benefits II Regulations in Germany lay down that no additional social benefits will be paid when nutrition is switched to a wholesome diet for medical reasons. This regulation is based on calculations performed with the so-called “shopping basket method”. This article presents a new approach, using a statistical model to determine possible additional social benefits, instead of the “shopping basket method”. On the basis of German Consumer Panel Research Data from the year 2011, the actual consumption behaviour of 13,131 households is investigated by regression analysis, in order to identify whether households with lower income and comparatively healthy food purchases pay more or less for this than lower income households with average purchasing behaviour.
The results show that the purchases of foods of lower energy density and higher densities of water soluble vitamins and trace elements are linked to greater expenditures. In contrast, higher densities of minerals and fat soluble vitamins were linked to reduced expenditures. The overall conclusion of the simulations was that shopping baskets of higher nutritional physiological quality were more expensive, so that there are additional needs for a wholesome diet.

Keywords: social benefit rates, socio-cultural subsistence level, wholesome diet, nutrient density, energy density, empirical analysis

Full text PDF (free access)