IDEAS home Printed from https://ideas.repec.org/a/bla/agecon/v38y2008i3p339-348.html

Dynamics of rice prices and agricultural wages in the Philippines

Author

Listed:
  • Christine D. Lasco
  • Robert J. Myers
  • Richard H. Bernsten

Abstract

Rice trade liberalization in the Philippines should decrease domestic rice prices impacting both agricultural wages and the welfare of agricultural wage earners. This study examines the short‐run and long‐run relationship between rice prices and agricultural wages in the Philippines using a neoclassical wage determination model. Three empirical frameworks are used—a cointegration/error correction framework, which assumes nonstationary variables in long‐run equilibrium, a first difference model that assumes nonstationary variables but no long‐run equilibrium, and an OLS framework that assumes the model variables are stationary. Conclusions are reasonably robust across the three empirical frameworks with wages adjusting positively to rice price changes with a short‐run elasticity of 0.29 to 0.57, and a long‐run elasticity of 0.70 to 1.0 in preferred models. An analysis of welfare implications suggests that although households that are heavily reliant on agricultural wages for income will be adversely affected by rice price decreases, other households will benefit.

Suggested Citation

  • Christine D. Lasco & Robert J. Myers & Richard H. Bernsten, 2008. "Dynamics of rice prices and agricultural wages in the Philippines," Agricultural Economics, International Association of Agricultural Economists, vol. 38(3), pages 339-348, May.
    • Handle: RePEc:bla:agecon:v:38:y:2008:i:3:p:339-348
    DOI: 10.1111/j.1574-0862.2008.00304.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1574-0862.2008.00304.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1574-0862.2008.00304.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Cororaton, Caesar B., 2004. "Rice Reforms and Poverty in the Philippines: A CGE Analysis," Discussion Papers DP 2004-14, Philippine Institute for Development Studies.
    2. Davidson, Russell & MacKinnon, James G., 1993. "Estimation and Inference in Econometrics," OUP Catalogue, Oxford University Press, number 9780195060119.
    3. Rashid, Shahidur, 2002. "Dynamics Of Agricultural Wage And Rice Price In Bangladesh: A Re-Examination," MSSD Discussion Papers 16226, CGIAR, International Food Policy Research Institute (IFPRI).
    4. David, Cristina C., 1997. "Agricultural policy and the WTO Agreement: The Philippine Case," Discussion Papers DP 1997-13, Philippine Institute for Development Studies.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. David Dawe, 2014. "Transmission of global food prices, supply response and impacts on the poor," Chapters, in: Raghbendra Jha & Raghav Gaiha & Anil B. Deolalikar (ed.), Handbook on Food, chapter 5, pages 100-121, Edward Elgar Publishing.
    2. Delphine Boutin, 2011. "D'une crise à l'autre : mesurer l'impact des prix alimentaires sur la pauvreté," Working Papers hal-00637608, HAL.
    3. Hanan G. Jacoby, 2016. "Food Prices, Wages, And Welfare In Rural India," Economic Inquiry, Western Economic Association International, vol. 54(1), pages 159-176, January.
    4. Hassan, Md. Fuad & Kornher, Lukas, "undated". "Farm Wage and Rice Price Dynamics in Bangladesh," Discussion Papers 287204, University of Bonn, Center for Development Research (ZEF).
    5. Vicente E. Montano, 2024. "Is there Price Distortion in the Philippine Rice Market: A Bayesian Discrete Wavelet Transform Analysis," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(15), pages 275-287, December.
    6. Kym Anderson & Maros Ivanic & William J. Martin, 2014. "Food Price Spikes, Price Insulation, and Poverty," NBER Chapters, in: The Economics of Food Price Volatility, pages 311-339, National Bureau of Economic Research, Inc.
    7. Lodovico Muratori & Susanne Fricke, 2017. "Spatial price transmission and trade policies: new evidence for agricultural products from selected sub-Saharan African countries with high frequency data," Jena Economics Research Papers 2017-006, Friedrich-Schiller-University Jena.
    8. Khadija Anjum & Leonora Angeles, 2025. "Farm workers’ food security during food price hikes: a political economy of landless rice-wheat farm labourers in Pakistan’s Punjab," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 42(3), pages 1361-1378, September.
    9. Md. Fuad Hassan & Lukas Kornher, 2022. "Farm wage and Rice Price dynamics in Bangladesh," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 14(1), pages 127-146, February.
    10. Delphine Boutin, 2011. "D’une crise à l’autre : Mesurer l’impact des prix alimentaires sur la pauvreté," Larefi Working Papers 1106, Larefi, Université Bordeaux 4.
    11. Ivanic, Maros & Martin, Will, 2014. "Short- and long-run impacts of food price changes on poverty," Policy Research Working Paper Series 7011, The World Bank.
    12. repec:lic:licosd:39217 is not listed on IDEAS
    13. Briones, Roehlano M., 2013. "Agriculture, Rural Employment, and Inclusive Growth," Discussion Papers DP 2013-39, Philippine Institute for Development Studies.
    14. Headey, Derek, 2011. "Was the Global Food Crisis Really a Crisis? Simulations versus Self-Reporting," Research briefs 17, International Food Policy Research Institute (IFPRI).
    15. Derek D. Headey, 2013. "The Impact of the Global Food Crisis on Self-Assessed Food Security," The World Bank Economic Review, World Bank, vol. 27(1), pages 1-27.
    16. Dawe, David & Maltsoglou, Irini, 2014. "Marketing margins and the welfare analysis of food price shocks," Food Policy, Elsevier, vol. 46(C), pages 50-55.
    17. Ivanic, Maros & Martin, Will & Zaman, Hassan, 2012. "Estimating the Short-Run Poverty Impacts of the 2010–11 Surge in Food Prices," World Development, Elsevier, vol. 40(11), pages 2302-2317.
    18. Delphine Boutin, 2011. "D’une crise à l’autre : Mesurer l’impact des prix alimentaires sur la pauvreté," Larefi Working Papers 201106, Larefi, Université Bordeaux 4.
    19. Martey, Edward & Onumah, Justina Adwoa & Adusah-Poku, Frank, 2025. "Maize price Shocks, food consumption and the mediating role of access to market in Ghana," Food Policy, Elsevier, vol. 130(C).
    20. Balié, Jean & Minot, Nicholas & Valera, Harold Glenn A., 2021. "Distributional impacts of the rice tariffication policy in the Philippines," Economic Analysis and Policy, Elsevier, vol. 69(C), pages 289-306.
    21. Headey, Derek D. & Bachewe, Fantu Nisrane & Worku, Ibrahim & Dereje, Mekdim & Taffesse, Alemayehu Seyoum, 2012. "Urban wage behavior and food price inflation: the case of Ethiopia," ESSP working papers 41, International Food Policy Research Institute (IFPRI).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Antzoulatos, Angelos A., 1998. "Macroeconomic forecasts under the prism of error-correction models," Journal of Economics and Business, Elsevier, vol. 50(6), pages 535-550, November.
    2. Kazumi Endo, 2019. "Does the stock market value corporate environmental performance? Some perils of static regression models," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 26(6), pages 1530-1538, November.
    3. David Hauner & Manmohan Kumar, 2011. "Interest rates and budget deficits revisited-evidence from the G7 countries," Applied Economics, Taylor & Francis Journals, vol. 43(12), pages 1463-1475.
    4. Anikó Bíró, 2013. "Subjective mortality hazard shocks and the adjustment of consumption expenditures," Journal of Population Economics, Springer;European Society for Population Economics, vol. 26(4), pages 1379-1408, October.
    5. Zanini, Fabio C. & Irwin, Scott H. & Schnitkey, Gary D. & Sherrick, Bruce J., 2000. "Estimating Farm-Level Yield Distributions For Corn And Soybeans In Illinois," 2000 Annual meeting, July 30-August 2, Tampa, FL 21720, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    6. Giuseppe Croce & Emanuela Ghignoni, 2011. "Overeducation and spatial flexibility in Italian local labour markets," Working Papers in Public Economics 145, Department of Economics and Law, Sapienza University of Rome.
    7. Chasco, Coro & López, Ana María & Guillain, Rachel, 2008. "The non-stationary influence of geography on the spatial agglomeration of production in the EU," MPRA Paper 10737, University Library of Munich, Germany.
    8. Davidson, Russell & Flachaire, Emmanuel, 2007. "Asymptotic and bootstrap inference for inequality and poverty measures," Journal of Econometrics, Elsevier, vol. 141(1), pages 141-166, November.
    9. Caginalp, Gunduz & DeSantis, Mark, 2017. "Does price efficiency increase with trading volume? Evidence of nonlinearity and power laws in ETFs," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 467(C), pages 436-452.
    10. María José Ibáñez & Felipe Vásquez Lavin & Roberto D. Ponce Oliva, 2023. "Female Underperformance Hypothesis Revisited: Methodological Review and Empirical Testing," SAGE Open, , vol. 13(4), pages 21582440231, December.
    11. Ramses Abul Naga & Frank Cowell, 2002. "Intergenerational Mobility in Britain: Revisiting the Prediction Approach of Dearden, Machin and Reed," Cahiers de Recherches Economiques du Département d'économie 02.15, Université de Lausanne, Faculté des HEC, Département d’économie.
    12. Liwu Hsu & Susan Fournier & Shuba Srinivasan, 2016. "Brand architecture strategy and firm value: how leveraging, separating, and distancing the corporate brand affects risk and returns," Journal of the Academy of Marketing Science, Springer, vol. 44(2), pages 261-280, March.
    13. Jongeneel, Roelof A. & Ge, Lan, 2005. "Explaining Growth in Dutch Agriculture: Prices, Public R&D, and Technological Change," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24573, European Association of Agricultural Economists.
    14. Dong, Yingying, 2010. "Jumpy or Kinky? Regression Discontinuity without the Discontinuity," MPRA Paper 25461, University Library of Munich, Germany.
    15. Vincenzo Cassino & Richard Thornton, 2002. "Do changes in structural factors explain movements in the equilibrium rate of unemployment?," Bank of England working papers 153, Bank of England.
    16. David F. Hendry & Hans-Martin Krolzig, 2005. "The Properties of Automatic "GETS" Modelling," Economic Journal, Royal Economic Society, vol. 115(502), pages 32-61, March.
    17. V. M. Manyong & I. Okike & T. O. Williams, 2006. "Effective dimensionality and factors affecting crop‐livestock integration in West African savannas: a combination of principal component analysis and Tobit approaches," Agricultural Economics, International Association of Agricultural Economists, vol. 35(2), pages 145-155, September.
    18. Barnett, William A. & Serletis, Apostolos, 2008. "Consumer preferences and demand systems," Journal of Econometrics, Elsevier, vol. 147(2), pages 210-224, December.
    19. Hany Eldemerdash & Hugh Metcalf & Sara Maioli, 2014. "Twin deficits: new evidence from a developing (oil vs. non-oil) countries’ perspective," Empirical Economics, Springer, vol. 47(3), pages 825-851, November.
    20. Rao, Surekha & Ghali, Moheb & Krieg, John, 2008. "On the J-test for nonnested hypotheses and Bayesian extension," MPRA Paper 14637, University Library of Munich, Germany.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:agecon:v:38:y:2008:i:3:p:339-348. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/iaaeeea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.