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Distributional Impacts of Food Price Changes on Romanian Households following EU Accession

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  • Hubbard, Carmen

Abstract

This paper focuses on the estimation of changes in economic welfare (real income) on different Romanian socio-economic households due to changes in food prices, following the country’s accession to the European Union (EU) in 2007. It updates and develops Hubbard and Thomson (2007) and identifies the winners and losers due to food price changes using the most recent, official, post accession data. The Slutsky Compensating Variation, based on construction of Laspeyres indexes, is employed for a food basket of 19 products. Given the importance of the share of self-consumption in total household consumption expenditure for almost all household types, the economic welfare impacts of food price changes (Slutsky CV) is estimated for both market (goods purchased) and non-market (goods produced and consumed within the household) components. Preliminary results show that real food prices have changed quite dramatically with some rising and others falling. The overall change in price for the 19 selected products, in real terms, is almost 20 per cent. This suggests high impacts on consumer welfare across the urban and rural households, particularly for low-income groups such as farmers, unemployed and pensioners.

Suggested Citation

  • Hubbard, Carmen, 2013. "Distributional Impacts of Food Price Changes on Romanian Households following EU Accession," 87th Annual Conference, April 8-10, 2013, Warwick University, Coventry, UK 158691, Agricultural Economics Society.
    • Handle: RePEc:ags:aesc13:158691
    DOI: 10.22004/ag.econ.158691
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    References listed on IDEAS

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    1. Willig, Robert D, 1976. "Consumer's Surplus without Apology," American Economic Review, American Economic Association, vol. 66(4), pages 589-597, September.
    2. Georgakopoulos, Theodore A, 1990. "The Impact of Accession on Food Prices, Inflation and Food Consumption in Greece," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 17(4), pages 485-493.
    3. Deaton,Angus & Muellbauer,John, 1980. "Economics and Consumer Behavior," Cambridge Books, Cambridge University Press, number 9780521296762.
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