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The macroeconomic and food security implications of price interventions in the Philippine rice market

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  • Mariano, Marc Jim M.
  • Giesecke, James A.

Abstract

The Philippine government has a number of policy interventions in the domestic rice market aimed at promoting national food security. This paper examines the economy-wide and food security implications of three of the main policies: a ceiling on prices paid by rice consumers; a floor on prices received by paddy producers; and a subsidy on prices paid for seeds by paddy farmers. These programmes have been subject to domestic criticism on allocative efficiency and distributional grounds. We examine the effects of removing the programmes using an economy-wide model with detailed treatment of agricultural activity, land use, and food security measures. We find that the programmes make a small contribution to food security, for a modest budgetary outlay. The allocative efficiency gains available from ending the programmes are small, and may be outweighed by the potential for adverse short-run macroeconomic consequences.

Suggested Citation

  • Mariano, Marc Jim M. & Giesecke, James A., 2014. "The macroeconomic and food security implications of price interventions in the Philippine rice market," Economic Modelling, Elsevier, vol. 37(C), pages 350-361.
  • Handle: RePEc:eee:ecmode:v:37:y:2014:i:c:p:350-361
    DOI: 10.1016/j.econmod.2013.11.025
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    References listed on IDEAS

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    Cited by:

    1. Briones, Roehlano M., 2016. "Embedding the AMPLE in a CGE Model to Analyze Intersectoral and Economy-Wide Policy Issues," Discussion Papers DP 2016-38, Philippine Institute for Development Studies.
    2. Kun Cheng & Qiang Fu & Tianxiao Li & Qiuxiang Jiang & Wei Liu, 2015. "Regional food security risk assessment under the coordinated development of water resources," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 78(1), pages 603-619, August.
    3. Mamoon, Dawood & Ijaz, Kinza, 2017. "How Climate Change and Agriculture Fares with Food Security in Pakistan?," MPRA Paper 81346, University Library of Munich, Germany.
    4. Marc Jim M. Mariano & James A. Giesecke & Nhi H. Tran, 2015. "The effects of domestic rice market interventions outside business-as-usual conditions for imported rice prices," Applied Economics, Taylor & Francis Journals, vol. 47(8), pages 809-832, February.
    5. Okimoto, Madoka, 2015. "International price competition among food industries: The role of income, population and biased consumer preference," Economic Modelling, Elsevier, vol. 47(C), pages 327-339.

    More about this item

    Keywords

    Food security; Food subsidies; General equilibrium; Land use; Rice market; Philippines;

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General

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