Coping with Rising Food Prices: Policy Dilemmas in the Developing World
AbstractRising food prices cause considerable policy dilemmas for developing country governments. Letting domestic prices adjust to reflect the full change in international prices generates inflationary pressures and causes severe hardship for poor households lacking access to social safety nets. Alternatively, governments can use food subsidies or export restrictions to stabilize domestic prices, yet this exacerbates global food price increases and undermines a rules-based trading system. The recent episode shows that many countries chose to shift the burden of adjustment back to international markets. The use of corn and oilseed for the production of biofuel will result in a recurrence of such episodes in the foreseeable future. [WP No. 164]
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Date of creation: Oct 2009
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Food Prices; Inflation; Poverty; Africa; Asia; Latin America; Caribbean; domestic prices; trading system; export; households; social safety nets; inflationalry pressures; governments; households; global food prices; international markets;
Other versions of this item:
- Nora Lustig, 2009. "Coping with Rising Food Prices: Policy Dilemmas in the Developing World," Working Papers 2009-04, The George Washington University, Institute for International Economic Policy.
- Nora Lustig, 2009. "Coping with Rising Food Prices: Policy Dilemmas in the Developing World," Working Papers 164, Center for Global Development.
- Nora Lustig, 2009. "Coping with Rising Food Prices: Policy Dilemmas in the Developing World," Working Papers 0907, Tulane University, Department of Economics.
- E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
- I38 - Health, Education, and Welfare - - Welfare and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
- Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy
- O24 - Economic Development, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
This paper has been announced in the following NEP Reports:
- NEP-AGR-2009-10-17 (Agricultural Economics)
- NEP-ALL-2009-10-17 (All new papers)
- NEP-SEA-2009-10-17 (South East Asia)
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