Child stunting in Ethiopia has persisted at alarming rates, despite enormous amounts of food aid, often procured in response to shocks. Using nationally representative data, the study finds that while harvest failure leads to child growth faltering, food aid affected child growth positively and offset the negative effects of shocks in communities that received food aid. However, many communities that experienced shocks did not receive food aid. In sum, while food aid has helped reduce child malnutrition, inflexible food aid targeting, together with endemic poverty and limited maternal education, has left the prevalence of child stunting at alarming levels.Key words: child growth, child malnutrition, Ethiopia, food aid, shocks.Children that grow slowly experience poorer psychomotor development and interact less frequently in their environment (GranthamMcGregor et al.). They tend to delay school enrolment, and score less well on cognitive tests (Martorell, 1997). Moreover, the detrimental effects of slow height growth during early childhood may be long lasting. For example, Alderman, Hoddinott, and Kinsey find that in Zimbabwe, lowered stature as a pre-schooler following exposure to the 1982-84 drought resulted in a permanent loss of stature of 2.3 cm, a delay in starting school of 3.7 months, and 0.4 grades less of completed schooling. The combined effect of these factors was estimated to reduce lifetime earnings by 7%.Rural households in developing countries often live in risky environments, unable to fully protect their consumption against temporary income shocks such as droughts (Dercon). The available empirical evidence to date on the effect of such income shocks on child growth suggests pervasive growth retardation (Martorell, 1999;Hoddinott and Kinsey). As such temporary income shocks may cause permanent damage to children's future welfare and cogTakashi Yamano is Fellow at the Foundation for Advanced Studies on International Development. Harold Alderman is Lead Human Development Economist. Luc Christiaensen is Economist in the Africa Region of the World Bank.The authors would like to thank John Hoddinott, Martin Ravallion, Norbert Schady, and John Strauss as well as seminar participants at the Chronic Poverty Conference at Manchester University for useful comments. Nonetheless, the findings, interpretations, and conclusions expressed are entirely those of the authors, and they do not necessarily represent the views of the World Bank, its Executive Directors, or the countries they represent. nitive abilities (World Bank), further empirical investigation to quantify the magnitude of the effect of such shocks on early child growth is called for.A common intervention to alleviate the effects of drought shocks is food aid, often motivated by explicit reference to its beneficial effect on child malnutrition. Ironically, however, there is limited research on the effect of food aid on child growth (Barrett). The literature has so far mainly focused on food aid targeting, i.e., whether the poor are reached or not (...