Food Security and Water Scarcity: A Theoretical

Framework

Richard Kidwingira∗ Nahid Masoudi† Georges Zaccour‡

Abstract

We characterize the domestic production and imports of food by a country under

two scenarios, namely: food security and welfare maximization, in a model with an
exogenously given probability of occurrence of an embargo or other sources of supply
disruption on the international grain market, e.g., a natural catastrophe. In our frame-
work, food security means relying on domestic production and considering imports only
if available water is not enough to ensure enough food to citizens. We compare the
volume of expected water used in domestic production, expected level of imports, as
well as the expected welfare under these different scenarios. By doing so, we provide
a measure to the cost of a food security policy.
Keywords: Water management; food security; foreign dependence; self-sufficiency
JEL Classification: Q25; D61

1 Introduction
In its narrowest definition, food security of a country means that enough food is made
available to the citizens by domestic production and imports from international markets.1
∗
GERAD, HEC Montréal, Canada. Email: rkidwingira@gmail.com
†
Department of Economics, Memorial University of Newfoundland, Canada. Email: nmasoudi@mun.ca
‡
GERAD, HEC Montréal, Canada. Email: georges.zaccour@gerad.ca, supported by SSHRC, Canada,
grant 435-2013-0532
1
The focus of this paper is only on the food availability of food security concept which is achieved when
sufficient quantities of food are available to all individuals within a country. Such food can be supplied
through domestic production or imports [Rivera and Qamar, 2003]. For a detailed discussion about this
concept see Pinstrup-Andersen [2009].

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Food security is used by some as a synonymous to self-sufficiency, that is, the country must
produce the food it needs for its population demands. The rationale is that as a necessity,
food is a strategic commodity, and no country can risk being blackmailed by exporters in
case of a political dispute. Although at first glance this definition sounds clear, it still
embeds an ambiguity since any country could claim self-sufficiency simply by closing the
food market to international producers and leaving the domestic market to equate demand
and supply at whatever price it would result. The World Food Summit 1996 defines food
security as “physical and economic access by all, at all times, to sufficient, nutritionally
adequate and safe food and its effective utilization” World Food Summit [1996]. No matter
what definition of food security is adopted, at the end of the day most countries are forced
to import a part of their foods from others. Population growth, scarcity of fresh water
resources and fertile soils in some countries make imports inevitable from countries blessed
with abundant water.
As a matter of fact, fresh water is key to food security. Agriculture requires large
quantities of fresh water for irrigation and of good quality for various production processes.
Only around 0.007 percent of the planet’s water is considered as available fresh water and
it is under increasing assault as the planet heats up, which puts up fresh water shortage on
the short list of possible causes of a next global crisis. The challenge is how to effectively
conserve, manage, and distribute fresh water in a context where the world’s population
continues to soar while the quantity of available water does not increase. Under these
circumstances, water scarcity is one of the urgent food security issues for many countries.
The problem of food security and water scarcity is not new and it has been the topic of
a significant literature. However, most studies have been empirical, with the objective of
quantifying and analyzing food security and water use issues in a specific region or country,
e.g., see Kulshreshtha and Tewari [1991], Zhang and Oweis [1999], Knapp et al. [2003], Hira
[2009], Hanjra and Qureshi [2010], Legras [2007], Viala [2008]. This paper aims at providing
a theoretical base for different scenarios of food security and fresh water management. We
consider a simple model where a country is focusing on food security as providing necessary
means (domestic production or monetary sources to import food) to make sure a minimum
secure level of food is made available to its citizens. In order to embed the drawbacks of

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dependency on international markets, we use the model suggested by Tolley and Wilman
[1997] to study the foreign dependence question in a general international trade model.
Our work is also related to the vast research in the area of virtual water, that is, the water
needed/used in the production process of an agricultural or industrial product [Hoekstra,
2013]. In this paper, the scope of the study is limited to agricultural products. For instance,
1,000 liters of water are required to produce 1kg of wheat Brown et al. [2009], 1kg of rice
requires twice to three times as much water, while 1kg of meat is produced with 16,000 liters
of water [Chapagain and Hoekstra, 2003]. The idea behind the concept is that, a water scarce
entity focuses on production of less water consuming products and import water intensive
products. Through international trade, virtual water trade is used as an alternative to
actual water transfer or use. It allows water savings locally by not using the water to
grow the crop. It allows water savings globally, if water rich entities are, as well, more
water efficient than water poor entities. The concept was introduced in 1993, and further
developed in a series of papers from 1999 to 2003, by John Anthony Allan. Virtual water
import is often used as a coping strategy by water scarce countries in order to achieve food
security. Even though such imports have an increasing share in food consumption in many
of those countries, it is not adopted as a voluntary choice. Domestic production shortfalls
are filled with imports (Wichelns, 2004). The most reported case is the Middle East region.
Faced with depleted water resources since the 1970s, and growing water demand due to an
increasing population, the region managed its water deficit through virtual water available
on the international market (Allan [2003]). Drawbacks to a virtual water imports policy as
a substitute to domestic irrigated agriculture are invoked to explain its unpopularity among
water policy managers. According to the world water council (2004), the first drawback is
dependence on main exporting countries. The latter could take advantage of their leverage
power to politically pressure importing countries. The second is damage to local agriculture
if it is unable to adapt. It has the potential to destroy livelihoods of thousands or, even
millions, in some parts of the world, if they depend heavily on agriculture and do not
have either the funds or the training to make the switch towards less water consuming
activities. Finally, the possibility of foreign reserve depletion leading to inability to import
at all, is said to be a third drawback to the policy. The importing entity would be in a

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situation where it could not have the foreign currencies needed to purchase food, as well
as other essential goods and services that are not produced domestically. Despite the main
drawbacks just listed, some facts in the reality advocate for the use of virtual water imports
as a policy instrument in water management. First of all, attempts to assess the volume of
global water trade flow between countries report a volume of 695 Gm3/year on average, over
1995-1999. This represents grossly 13% of the water used for crop production in the world
[Hoekstra and Hung, 2005]. Secondly, in an instance where water scarcity is absolute and
there is no room for improving efficiency, virtual water import is adopted de facto as the
ultimate solution (Allan, 2003). Thirdly, a study by Yang et al. [2003], uses the relationship
between per capita water availability in a country and its net cereal imports. The results
point out a threshold at 1,500 m3/year per capita of water availability below which water
decrease leads to an important increase in cereal imports, whereas, the relationship is barely
observable above. Lastly, for some countries, the current pace of water withdrawal is just
not sustainable in the long run, e.g. According to a recent report from the World bank on
the Middle East and North Africa region, majority of the countries of this region extract
significantly more water than is replenished from natural resource [World Bank, 2007].
We provide a theoretical model to evaluate the cost of current policies with regard
to food security by presenting two different scenarios, namely food security and welfare
maximization, in an international trade model and compare the welfare loss and water
consumption under these two scenarios.
The rest of the paper is structured as follows. Section (2) presents the model. Section
(3) presents the business as usual (food security) scenario. Section (4) studies the welfare
maximization scenario. Comparison of the results is provided in Section (5). Finally, we
wrap up with the concluding remarks in Section (6).

2 The model
To keep it simple, while still capturing the main qualitative features of the context, let us
suppose that food production in a country can be represented by one composite good to
which we shall refer to as food. To produce this good, the country needs fresh water, whose

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availability is limited. (Note that we can also consider virtual water, but refrain from doing
it to keep the framework as parsimonious as possible.) The demand for staple food q can
be met by local supply s and possibly by importing from international markets at a given
international price T . The imports are given by m = q − s.
The marginal benefit to the society from consuming food is given by the inverse demand
p(q). The domestic production is assumed to depend on only one input, namely, fresh water,
denoted by w. Denote by s (w) the domestic water yield function, or production function,
and by c (w) the corresponding production cost. We make the following assumptions on the
functional forms:

Assumption 1: The inverse demand function is linear in q and is given by

p(q) = b − q, (1)

where b is a positive parameter measuring the maximum willingness-to-pay for food.

Assumption 2: The water yield function is concave increasing and approximated by the
linear function
s(w) = θw, (2)

where θ is a positive parameter representing the marginal productivity of water.

Assumption 3: The marginal cost of producing crop is convex and increasing, and is
approximated by the linear function

c (w) = φw, φ > 0. (3)

Before continuing further, we briefly discuss the above assumptions. The linearity of the
demand function can be justified on the ground that it is derivable from the maximization
of a strictly concave quadratic consumer’s utility function. In some empirical works (see,
e.g., Kulshreshtha and Tewari [1991], Zhang and Oweis [1999], Knapp et al. [2003]), the
water yield function has been found to be quadratic, that is, s (w) = θ0 + θ1 w − θ2 w2
with θ0 , θ1 , θ2 > 0. Assumption 2 amounts at assuming θ0 = θ2 = 0. The positivity of θ0 is

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empirically driven (i.e., to have a better model’s fit), but is not essential conceptually as one
expects the production to be zero when no water is available. Further, the nonnegativity of
production requires θ2 to be sufficiently low. To illustrate, Zhang and Oweis [1999] estimated
θ2 to be −2.778 × 10−5 in the case of Syria, while the values for θ0 and θ1 were 6.4335 and
0.0378, respectively. Given these values, imposing θ2 = 0 could end up not being a severe
restriction. Further, we assume that the total available water is given by W̄ , and therefore
impose the following constraint:

Water availability constraint : w ≤ W̄ . (4)

The use of water in agriculture involves two general costs, namely: (i) direct cost of
transiting and applying the water; and (ii) environmental cost related to the damage caused
by agricultural activities to the environment and the aquifer in terms of, e.g., waterlogging
and salinization. For details, see, e.g., [Legras, 2007]. As all these costs are in direct
relationship with the amount of used water, we summarize them in a single function and
assume that the marginal production cost can be well approximated by (3).
Importing food is considered as an issue in food security context because there is a
probability of not being able to import staple food, for example, due to an embargo or
a natural catastrophe. We follow Tolley and Wilman [1997] and let π, 0 < π < 1, be the
exogenously given probability of occurrence of a major supply disruption on the international
market. Denote by B the country’s net benefit (or welfare) from staple food. Given our
assumptions, the expected net welfare or benefit function is expressed as follows:
ˆ q ˆ s  ˆ s ˆ s 
E (B) = (1 − π) p (y) dy − c (x) dx − T m + π p (y) dy − c (x) dx . (5)
0 0 0 0

Since at equilibrium, the consumption can be redefined as q(w, m) = θw + m, then (5) is

equivalent to
ˆ θw+m ˆ θw ˆ θw+m
E(B) = p(y)dy − c(x)dx − T m − π p(y)dy + πT m. (6)
0 0 θw

The expected net welfare consists of the following elements: (i) the total expected welfare

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of food consumption, which is the area under the demand curve on the interval [0, θw + m];
(ii) the cost of domestic production, which is the area under the supply curve (marginal
cost) between 0 production and the level of production s = θw; (iii) the cost of imports
given by T m; (iv) the loss in consumption following the non-availability of imported crop
´q
due to a disruption in international market, that is, π s p (y) dy, which is measured by the
area under the demand curve between s, the domestic supply, and the level of consumption;
finally, (v) πT m, which represents the savings in imports made during a disruption. Given
our specification of the functional forms, the expected welfare function can be rewritten as
follows:

1 1
E (B) = − (1 + φ) θ2 w2 − (1 − π) m2 − θ (1 − π) wm + bθw + (1 − π) (b − T ) m. (7)
2 2

We assume that the country faces a food security constraint, that is, ensuring a minimum
level of food consumption, D, is provided. The parameter D could be estimated by, e.g., a
minimum number of calories per capita times the population of the country. Formally, we
have
Food security constraint: s + m ≥ D. (8)

In the sequel, we shall consider and contrast two scenarios, namely:

Food security: The country privileges local production and considers food import as a last
resort. Put differently, the food security policy consists in using all the water available
to produce food before importing, even if the cost of local production is higher than
importing. We superscript with F S the results in this case.

Welfare optimization: In this benchmark scenario, the country aims at maximizing the
expected welfare and does not self-impose to use all its water before considering im-
ports. Formally, the country solves the following optimization problem:

maxw,m≥0 E (B) = b − 21 (1 + φ) θw θw − (1 − π) m 1



2
m + θw + b − T ,
(9)
Subject to: D ≤ s + m, and w ≤ W .

The differences between the two scenarios give a measure of the cost of food security. This

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cost can be assessed in terms of, e.g., welfare loss or water use, depending on the focus of
the decision makers.

3 Food security scenario

As stated before, current policies in most countries are very reluctant to rely on imports
as an option in their food security and water management policies. In fact, food import is
considered as a solution of last resort when no other option is left and countries try to stick
to self-sufficiency as much as possible. Let wD be the water needed to produce the quantity
D
of food D, that is, wD = θ
. There are two possible cases, namely: (1) not enough water
is available to domestically produce the minimum required food, and consequently imports
are inevitable; and (2) water is available in sufficient volume to produce D. We consider in
turn these two cases.

Water scarcity (case 1): In this case, W < wD and the imports are given by mF1 S =
D − θW . Substituting for these values in the expected welfare function, we get

θ2 2 (1 − π) 2
B1F S


E = − (π + φ) W − D + (T + π (b − T )) θW + (1 − π) (b − T ) D.
2 2
(10)

Water abundance (case 2): Here, we have W ≥ wD . The fresh water constraint is slack,
and as such the country could produce crop beyond its basic needs. Any surplus can
be exported, and we will have negative imports. Note that the case of not having limit
on the quantity of water is not of much interest here. Therefore, we shall confine our
analysis to cases where m ≥ 0. In fact, this assumption will not alter the qualitative
conclusions. So, if W ≥ wD , then we assume that no imports are needed (m = 0),
and consequently wF S = wD and mF2 S = 0, i.e., (w2F S , mF2 S ) = ( Dθ , 0). The resulting
net expected benefit is

1
E B2F S = − (1 + φ) D2 + bD.


(11)
2

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4 Welfare optimization scenario
In this section, we compute the optimal solution where no particular values for water use
or imports are assumed. Then, we compare the results with the food security scenario
discussed above. The optimal values in this scenarios are superscripted with ∗.
To solve the problem in (9), introduce the Lagrangian

L(w, m, λ, µ) = − 21 (1 + φ) θ2 w2 − 12 (1 − π) m2 − θ (1 − π) wm + bθw

(12)
+ (1 − π) (b − T ) m + λ (θw + m − D) + γ W − w ,

where λ and γ are Lagrange multipliers or the shadow prices associated with the minimum
requirement of food and scarcity of water constraints, respectively.
The Karush-Kuhn-Tucker optimality conditions are

∂L ∂L
= − (1 + φ) θ2 w − (1 − π) θm + (b + λ) θ − γ ≤ 0, w ≥ 0, and w = 0, (13)
∂w ∂w
∂L ∂L
= (1 − π) (−m − θw + b − T ) + λ ≤ 0, m ≥ 0, and m = 0, (14)
∂m ∂m
∂L ∂L
= θw + m − D ≥ 0, λ ≥ 0, and λ = 0, (15)
∂λ ∂λ
∂L ∂L
= W − w ≥ 0, γ ≥ 0, and γ = 0. (16)
∂γ ∂γ

We first discuss the conditions under which both domestic production and imports are
positive (interior solution). Then, we look into cases where either production or import is
zero (corner solutions).

4.1 Interior Solutions

The following proposition collects the result when w and m are strictly positive.

Proposition 4.1 Positive domestic production and imports (w > 0, m > 0).
If λ > 0, i.e., the home-grown food and imports are exactly equal to the minimum food
requirement, then the optimal water use, imports and welfare are as follows:

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 • If γ = 0, then water use and imports will be chosen at a level that the expected marginal
net benefit of the two options are equal, and we have

(1 − π) T + πb
w∗ = , (17)
(φ + π) θ
(1 − π) T + πb
m∗ = D − = D − θw∗ , (18)
(φ + π)
∗ (π (b − T ) + T )2 (1 − π) D (2 (b − T ) − D)
E (B ) = + . (19)
2 (φ + π) 2

• If γ > 0, that is the available water is scarce and it is optimal to use the entire water,
then

w∗ = W , (20)

m∗ = D − θW , (21)
θ2 2 (1 − π) 2
E (B ∗ ) = − (π + φ) W − D + bθW + (1 − π) (b − T ) D, (22)
2 2

If λ = 0, i.e., the home-grown food and imports exceed the minimum food requirement, and
the food security is not a constraint. Then the optimal water use, imports and expected
welfare are as follows:

• If γ = 0, then

(1 − π) T + πb
w∗ = , (23)
(φ + π) θ
φb − (1 + φ) T
m∗ = , (24)
(π + φ)
πb2 + T 2 + φ (T − b)2 (1 − π)


∗
E (B ) = . (25)
2 (π + φ)

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 • If γ > 0, then

w∗ = W , (26)

m∗ = b − T + θW ,


(27)


γ = θW (bπ + T (1 − π)) − θW (π + φ) , (28)
1 2

E (B ∗ ) = (1 − π) (T − b)2 + 2T θW − θ2 W (π + φ) + 2πbθW .


(29)
2

Proof. The assumption here is that w and m are strictly positive. The possible cases are:
(i) γ = 0 and λ > 0; (ii) γ = 0 and λ = 0; (iii) γ > 0 and λ > 0; and (iv) γ > 0 and
λ = 0. Recall that λ > 0 means that the food security constraint is binding and as such,
the available food quantity (production plus imports) is exactly equal to D. γ > 0 means
the fresh water is scarce, as its shadow price is positive, then all water W is used for food
production. While if γ = 0 then the water is not scarce.
First, suppose that γ = 0. Then, from the first two optimality conditions (13)-(14) we
obtain that the domestic production is chosen such that the expected marginal benefit of
home production and imports are equal and they both are equal to the shadow price of food
security, λ, i.e.,

(1 + φ) θw + (1 − π) m − b = λ = (1 − π) (θw + m − (b − T )) . (30)

The above equalities hold true for both possible values of λ, that is, λ > 0 and λ = 0. The
optimal use of water is then given by

(1 − π) T + πb
w∗ = , (31)
(φ + π) θ

(1−π)T +πb
if (φ+π)θ
≤ W , then γ = 0; otherwise, w∗ = W , which corresponds to the case of γ > 0.
The optimal value of imports will depend on the status of the constraint θw∗ + m ≥ D. If
θw∗ + m = D, that is, home grown food and imports are exactly equal to the minimum
food requirement, and we have λ > 0. If θw∗ + m > D, then the quantity of available food
exceeds this minimum.

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4.2 Extreme cases or corner solutions

We now characterize the optimal corner solutions, that is, when either domestic production
is nil (results are subscripted with 1) or imports are zero (results are subscripted with 2).
We can think of situations where it is optimal to not produce domestically and just rely
on imports. This is the case when for all admissible values of w, m and λ ≥ 0, the expected
marginal benefit of utilizing water is less than its marginal cost, i.e., from condition (13) we
have b − (1 − π) m + λ − θw < φθw, and consequently the water shadow price is zero, i.e.,
γ = 0.

Proposition 4.2 If no local production takes place (w = 0), then the optimal imports are
m1 = D and the expected welfare is given by

1
E (B1∗ ) = − (1 − π) D2 + (b − T ) (1 − π) D. (32)
2

Proof. The optimality conditions (13)-(16) reduces to

∂L
= − (1 + φ) θ2 w − (1 − π) θm + bθ + λθ < 0, and w = 0, (33)
∂w
∂L
= − (1 − π) m + (1 − π) (b − T ) + λ = 0, and m > 0, (34)
∂m
∂L ∂L
= m − D ≥ 0, λ ≥ 0, and λ = 0, (35)
∂λ ∂λ
∂L ∂L
= W ≥ 0, γ ≥ 0, and γ = 0. (36)
∂γ ∂γ

The last condition requires to have γ = 0. If λ > 0, then the third condition yields
m1 = D. Substituting in the second condition, we get

λ1 = (1 − π) (D + T − b) . (37)

Substituting in (9), we get

 
1
E (B1∗ ) = − D+b−T (1 − π) D. (38)
2

The case λ = 0 leads to a contradiction. Indeed, the second optimality condition yields

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 ∂L
m = b − T . Substituting in the first condition, we get ∂w
= T (1 − π) + πb, which is strictly
∂L
positive and hence contradicts the requirement that ∂w
≤ 0. This means in the extreme
case that it is not optimal to produce locally, the imports will be just as much to ensure
food security and will not go beyond that.
The other extreme case happens when water is enough to support food security, i.e.,
D
W ≥ θ
, and for all admissible values of w, m and λ ≥ 0, the expected marginal cost of
imports is strictly higher than its expected marginal benefit, i.e., from (14) condition we
have (1 − π) (b − θw − m) + λ < (1 − π) T . In this case, food will be provided only by
domestic production and no imports will happen. Proposition (4.3) summarizes the results
for this case (opposite of the previous one), with w > 0 and m = 0.

Proposition 4.3 Positive local production and no imports (w > 0, m = 0) . Assuming Dθ ≤

W , the optimal water use is given by w2∗ ∈ Dθ , W , and the optimal expected welfare by

 
1
E (B2∗ ) = − (1 + φ) θw2 + b θw2∗ .
∗
2

Proof. The optimality conditions (13)-(16) reduces to

∂L
= − (1 + φ) θ2 w + bθ + λθ − γ = 0, and w > 0, (39)
∂w
∂L
= − (1 − π) θw + (1 − π) (b − T ) + λ < 0, and m = 0, (40)
∂m
∂L ∂L
= θw − D ≥ 0, λ ≥ 0, and λ = 0, (41)
∂λ ∂λ
∂L ∂L
= W − w ≥ 0, γ ≥ 0, and γ = 0. (42)
∂γ ∂γ

D
If λ > 0, then the third condition yields the optimal level of water use, that is, w = θ
,
and the net benefit welfare is

1
E (B2∗ ) = − (1 + φ) D2 + bD.
2

b ∂L
If λ = 0 and γ = 0 (and 1+φ
> b − T , this condition is necessary to have ∂m
< 0 in this

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solution), then the water use volume is given by
 
b
w = min ,W ,
(1 + φ) θ

b D
where (1+φ)θ
≥ θ
and net benefit welfare is

 
1
E (B2∗ ) = − (1 + φ) θw2 + b θw2∗ ,
∗
(43)
2

b
and if (1+φ)θ
≤ W , then
b2
E (B2∗ ) = − .
2 (1 + φ)

If γ > 0, then w = W .
D
To summarize, assuming W ≥ θ
, when only local production of food is optimal and no
imports should happen, we have the following cases:



 W, if γ > 0,

w2∗ = D
θ
, if λ > 0 and γ = 0 (44)

 n o
 min b
,W , if λ = γ = 0.

(1+φ)θ

Recall that λ > 0 means that food requirement constraint is binding, and γ > 0 means that
all available water is used.

5 Comparison
In this section, we compare the results in the two scenarios, starting by water use and next
welfare.

5.1 Water use comparison

The results from Sections (3) and (4) are summarized in Table 1 and call for the following
two comments:
First, while, as expected, in most cases the use of water is lower in the welfare optimiza-

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tion scenario than in the food security scenario, but the opposite can still happen in the case
where water is not scarce and willingness to pay for food is higher than its marginal cost
at the food security level, i.e., when domestic production goes beyond D. Second, if water
is scarce, then the interior solution in the welfare optimization scenario coincides with the
result in the food security case with positive local production and imports. Here, we have
w∗ = wF S = W and m∗ = mF S = D − θW .

5.2 Welfare comparison

Table 2 collects the welfare values obtained in the two scenarios.

Based on these results, we list the cases where there is an improvement in welfare when
moving from the food security to welfare optimization scenario, that is, when

1. The expected marginal net benefit of domestic production gets lower than expected
marginal net benefit of imports before the entire water is exhausted. In the model
π(b−T )+T π(b−T )+T
notation, when (φ+π)θ
≤ D and (φ+π)θ
≤ W.

2. The expected marginal cost of domestic production is strictly higher than the expected
marginal cost of imports (the results are sub-scripted by 1), which is an extreme case
of the previous situation.

3. The expected marginal benefit of consumption is higher than the marginal cost of
either domestic production or imports for consumption level D.

Case 1 can be explained better using Figure (1), which presents the expected welfare as a
π(b−T )+T
function of water consumption for agriculture. Note that the condition (φ+π)θ
= w, is the
result of optimizing the expected welfare (1), where the expected marginal net benefit of
using water for domestic production is equal to expected marginal net benefit of imports.
π(b−T )+T
If the available water is more than this optimal level, i.e., (φ+π)θ
≤ W (as in Figure (1))
and W ≤ wd , then by pressing on domestic independence in the food security scenario, we
end up over using water in an inefficient way.
In case 2, the expected benefit, E(B), will be always decreasing in w as expected net
benefit of domestic production is less than imports for all admissible values of water con-

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 Table 1: Water use and imports comparison.
Scenario Water use Imports Comparison
Welfare Optimization
Interior solutions w > 0 and m > 0 w∗ m∗
λ > 0, (1−π)T +πb (1−π)T +πb
(φ+π)θ
D− (φ+π)
w∗ < wF S
γ =0
λ > 0,
W D − θW w∗ = wF S
γ >0
λ = 0, (1−π)T +πb φb−(1+φ)T
(φ+π)θ (π+φ)
w∗ < wF S
γ =0
λ = 0,
W b − (T + θW ) w∗ = wF S
γ >0
Corner solutions
w = 0, m > 0 w1∗ m∗1

λ>0 0 D w∗ < wF S

w > 0, m = 0 w2∗ m∗2

λ = 0, b
min{ (1+φ)θ ,W} 0 w∗ ≥ wF S
γ =0
λ > 0, D
θ
0 w∗ = wF S
γ =0
γ>0 W 0 w∗ = wF S

Food Security wF S mF S

W < wD W D − θW -

D
W ≥ wD θ
0 -

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 Table 2: Expected welfare under different scenarios.
Scenario Expected welfare
Welfare Optimization
Interior solutions (w > 0 and m > 0)
λ > 0, (T (1 − π) + πb)2 (1 − π) D (2 (b − T ) − D)
E (B ∗ ) = +
γ =0 2 (φ + π) 2
λ > 0,
E (B ∗ ) = − 2θ (π + φ) W + b θW + b − T − D2 (1 − π) D



γ >0
λ = 0, πb2 +(T 2 +φ(T −b)2 )(1−π)
E (B ∗ ) = 2(π+φ)
γ =0
λ = 0,
E (B ∗ ) = 12 (1 − π) (T − b)2 + 2T θW − θ2 W 2 (π + φ) + 2πbθW



γ >0
Corner solution, no domestic production, w = 0 and m > 0
E (B1∗ ) = b − T − D2 (1 − π) D


λ>0
Corner solution, no imports, w > 0 and m = 0
λ = 0,
E (B2∗ ) = − 21 (1 + φ) θw2∗ + b θw2∗


γ =0
λ > 0,
E (B2∗ ) = − 21 (1 + φ) D + b D


γ =0
E (B2∗ ) = − 21 (1 + φ) θW + b θW


γ>0
Food Security
θ D




W < wD E BF S = 2
(π + φ) W + T (1 − π) + πb θW + b − T − 2
(1 − π) D

E B F S = − 12 (1 + φ) D2 + bD


W ≥ wD

Figure 1: Expected welfare.

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sumption. As such, the optimal w will be zero. In case 3, the expected marginal benefit of
food consumption is still higher than its cost (either via domestic production or imports)
so it is welfare improving to consume beyond the food security level.
There is no question about the fact that in any case E (B ∗ ) ≥ E B F S , as the former

is the result of optimizing the society’s expected benefit, while the latter is focusing on
self-sufficiency. However, comparison between optimal welfare and the food security welfare
provides a base for the society’s burden to follow a more political reasoning and persist on
π(b−T )+T
self-sufficiency. For the above mentioned case 1, that is, when (φ+π)θ
≤ W and W ≤ wd ,
one interesting question is how different the optimal and food security welfares are. The
most important parameter which defines this difference is π, that is, the probability of
π(b−T )+T
∂ ( (φ+π)θ )
having a disruption in the imports. Since ∂π
≥ 0,2 we can conclude that the larger
π is the smaller is the difference between optimal water consumption and the FS water
consumption. Besides, if λ = 0 this conclusion is still valid since in that case we have
−T +φ(b−T )
imports m∗ = φ+π
that are higher than the FS. But since ∂m∗
∂π
< 0, higher π makes
the difference between mF S and m∗ smaller. The following proposition highlights this result.

Proposition 5.1 The higher the probability of disruption in imports, the smaller the dif-
ference between the welfare-optimization and food-security scenarios.

6 Concluding remarks
Food security is a public good and, as such, one of the most important responsibilities of the
governments. For many developing countries, food security boils down to focusing on self-
sufficiency and so using domestic production as the primary source of food production and
considering imports as last resort option when no other solution is available. However, while
there is always the fear of an embargo or some sort of supply disruption on the international
market, e.g., a natural catastrophe, such disruptions do not happen that often. So including
the interruptions is critical but overstating them could be too costly. In this paper, we
π(b−P )+P
2 ∂( (φ+π)θ ) θ[(b−P )φ−P ]
∂π = ((φ+π)θ)2
, since we need the condition (b − P ) φ ≥ P in order to maintain positive m,
π(b−P )+P
∂( (φ+π)θ )
we can conclude ∂π ≥ 0.

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compare two different scenarios, a food-security scenario and an optimization scenario that
maximizes the expected welfare of society given the possibility of food imports interruption
and subject to providing a minimum value of food to the society. We compare the expected
water consumption, imports and social welfare under these two scenarios in the aim of
providing a theoretical baseline for assessing the cost of self-sufficiency.
The results suggest that in most cases the use of water is lower in the welfare optimization
scenario than in the food security scenario, which is not a surprising result given the fact that
in the welfare optimization scenario limiting imports is not an issue in itself. However, the
opposite could also happen in the case that water is not scarce and willingness to pay for food
is higher than its marginal cost at the food security level. In this case, domestic production
goes beyond the necessary food level to assure food security. Besides, obviously, in any case
expected welfare under food security will not be higher than optimization scenario as the
latter is the result of optimizing the society’s expected benefit, while the former is focusing
on self-sufficiency. However, comparison between optimal welfare and the food security
welfare provides a base for the society’s burden when follows a more political reasoning and
persists on self-sufficiency. As we can expect, as the probability of disruption in imports
increases the difference between these two shrinks.
There are many aspects of food security and water consumption that we did not cover.
Further research could include the dynamics of the problem, and also other aspects of food
security, i.e., food access and food utilization. Food access is concerned with distribution
of the available food and making sure that households and all individuals within them have
adequate resources to obtain appropriate food. Food utilization is the proper biological
use of food, requiring a diet providing sufficient energy and essential nutrients [Rivera and
Qamar, 2003].

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