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Fluctuating staple prices and household poverty in India

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  • Shutes, Lindsay
  • Ganesh-Kumar, Anand
  • Meijerink, Gerdien W.

Abstract

The general perception is that high food prices in India have increased poverty and that trade reforms will further worsen poverty. We compare Foster-Greer-Thorbecke poverty measures for various scenarios of grain price swings with and without trade reform, using price and income effects for 32 representative households computed from a global economic model and a model of India's economy. The results suggest that a rise in the global rice price actually provides strong opportunities for poverty alleviation. Global trade reform reinforces this effect for all rural population groups. An increase in urban poverty partly offsets the overall poverty reduction. While India's trade measures effectively isolate sectors from swings in global markets, they also cause India to miss opportunities to benefit from buoyant global prices.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 40982.

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Date of creation: 31 Aug 2012
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Handle: RePEc:pra:mprapa:40982

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Keywords: Poverty; food prices; trade; CGE analysis; India; household analysis;

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  1. Margaret Chitiga & Ramos Mabugu, 2006. "Does Trade Liberalisation Lead to Poverty Alleviation? a CGE Microsimulation Approach for Zimbabwe," Working Papers MPIA 2006-18, PEP-MPIA.
  2. Caesar B. Cororaton & John Cockburn & Erwin Corong, 2005. "Doha Scenarios, Trade Reforms, and Poverty inthe Philippines: a CGE Analysis," Working Papers MPIA 2005-03, PEP-MPIA.
  3. Cogneau, Denis & Robilliard, Anne-Sophie, 2000. "Growth, distribution and poverty in Madagascar," TMD discussion papers 61, International Food Policy Research Institute (IFPRI).
  4. Caesar B. Cororaton & John Cockburn, 2005. "Trade Reform and Poverty in the Philippines: a Computable General Equilibrium Microsimulation Analysis," Cahiers de recherche 0513, CIRPEE.
  5. Decaluwe, B. & Patry, A. & Savard, L. & Thorbecke, E., 1999. "Poverty Analysis Within a General Equilibrium Framework," Papers 9909, Laval - Recherche en Politique Economique.
  6. Dasgupta, Dipak & Dubey, R.N. & Sathish, R, 2011. "Domestic Wheat Price Formation and Food Inflation in India," MPRA Paper 31564, University Library of Munich, Germany.
  7. A. Ganesh-Kumar & Manoj K. Panda & Mary E. Burfisher, 2006. "Reforms in Indian agro-processing and agriculture sectors in the context of unilateral and multilateral trade agreements," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2006-011, Indira Gandhi Institute of Development Research, Mumbai, India.
  8. Nabil Annabi & Fatou Cissé & John Cockburn & Bernard Decaluwé, 2005. "Trade Liberalisation, Growth and Poverty in Senegal: a Dynamic Microsimulation CGE Model Analysis," Cahiers de recherche 0512, CIRPEE.
  9. A. Ganesh-Kumar & Manoj Panda & Mary E. Burfisher, 2006. "Reforms in Indian Agro-processing and Agriculture Sectors in the Context of Unilateral and Multilateral Trade Agreements," Trade Working Papers 22408, East Asian Bureau of Economic Research.
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