Short- and Long-Run Impacts of Food Price Changes on Poverty

This study uses household models based on detailed expenditure and agricultural production data from 31 developing countries to assess the impacts of changes in global food prices on poverty in individual countries and for the world as a whole. The analysis finds that food price increases unrelated to productivity changes in developing countries raise poverty in the short run in all but a few countries with broadly-distributed agricultural resources. This result is primarily because the poor spend large shares of their incomes on food and many poor farmers are net buyers of food. In the longer run, two other important factors come into play: poor workers are likely to benefit from increases in wage rates for unskilled workers from higher food prices, and poor farmers are likely to benefit from higher agricultural profits as they raise their output. As a result, higher food prices appear to lower global poverty in the long run.

Bibliographic Details

Main Authors:	Ivanic, Maros, Martin, Will
Language:	English en_US
Published:	World Bank Group, Washington, DC 2014-08
Subjects:	ADVERSE IMPACTS, AGGREGATE POVERTY, AGRICULTURAL ACTIVITIES, AGRICULTURAL ECONOMICS, AGRICULTURAL LAND, AGRICULTURAL OUTPUT, AGRICULTURAL PRICES, AGRICULTURAL PRODUCTION, AGRICULTURAL PRODUCTIVITY, AGRICULTURAL PRODUCTS, AGRICULTURAL SECTORS, AGRICULTURAL WAGES, AGRICULTURE, ANIMAL FEED, BEEF, BEVERAGES, CASSAVA, CHANGES IN POVERTY, COMMODITY, COMMODITY PRICES, DAIRY, DECLINE IN POVERTY, DECOMPOSABLE POVERTY, DEMOGRAPHIC, DEVELOPING COUNTRIES, DEVELOPING COUNTRY, EXTREME POVERTY, EXTREME POVERTY LINE, FARM ACTIVITIES, FARM HOUSEHOLDS, FARM INCOMES, FARM OUTPUT, FARMING ACTIVITIES, FEMALE-HEADED HOUSEHOLDS, FINANCIAL CRISIS, FOOD BUYERS, FOOD COMMODITIES, FOOD COMPONENTS, FOOD CONSUMERS, FOOD CONSUMPTION, FOOD DEMAND, FOOD ITEMS, FOOD OUTPUT, FOOD POLICY, FOOD POLICY RESEARCH, FOOD PRICE, FOOD PRICES, FOOD PRODUCTION, FRUITS, FUTURE PRICE, GLOBAL POVERTY, GRAINS, HOUSEHOLD BUDGET, HOUSEHOLD INCOME, HOUSEHOLD INCOMES, HOUSEHOLD OUTPUT, HOUSEHOLD SIZE, HOUSEHOLD SURVEY, HOUSEHOLD SURVEYS, HOUSEHOLD WELFARE, HUMAN DEVELOPMENT, IFPRI, IMPACT ON POVERTY, INCOME, INCOME DISTRIBUTION, INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE, INTERNATIONAL TRADE, LAMB, LAND SUPPLY, LIVING STANDARDS, LOW-INCOME COUNTRIES, MAIZE, MIDDLE-INCOME COUNTRIES, MILK, NATURAL RESOURCES, NET FOOD CONSUMERS, OILS AND FATS, OUTPUTS, POOR, POOR FARMERS, POOR FARMING, POOR HOUSEHOLDS, POOR PEOPLE, POOR POPULATION, PORK, POVERTY ASSESSMENT, POVERTY GAP, POVERTY IMPACT, POVERTY INCREASE, POVERTY LEVELS, POVERTY LINE, POVERTY LINES, POVERTY MEASURES, POVERTY RATE, POVERTY RATES, POVERTY REDUCTION, PRICE BEHAVIOR, PROCESSED FOODS, PRODUCTION STRUCTURE, PRODUCTION VOLUMES, REDUCTION IN POVERTY, REGIONAL GROUPS, RICE, RURAL, RURAL AREAS, RURAL DEVELOPMENT, RURAL FARMER, RURAL HOUSEHOLDS, RURAL POOR, RURAL WELFARE, SAFETY NET, SAFETY NET PROGRAMS, SELLING PRICES, SHEEP, SHEEP MEAT, SMALL FARM HOUSEHOLDS, SOYBEANS, STAPLE FOODS, SUGAR, TEA, VEGETABLE OILS, VEGETABLES, VOLATILITY, WAGE RATES, WHEAT, WHEAT PRODUCTION, WORLD ECONOMY,
Online Access:	http://documents.worldbank.org/curated/en/2014/08/20131428/short--long-run-impacts-food-price-changes-poverty https://hdl.handle.net/10986/20350
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