Weather shocks, food prices and food security: Evidence from South Africa

In this paper, we analyze the food access dimension of food security, and we model the link between weather shocks and food security that acts specifically through food prices. We focus on dietary diversity as a measure of food security, and we employ an instrumental variable model where household dietary diversity is determined by food prices instrumented with standardized precipitation evapotranspiration index (SPEI), a measure of weather shock. Our findings suggest that food prices have a significant negative impact on household food security, i.e. a one per cent increase in local food prices induced by a weather shock decreases the number of food items consumed by household by around 2.5 per cent, and the number of food groups by almost one per cent. The low-income households are particularly vulnerable to weather and price shocks; however, their response to shocks seem to depend on the level of poverty. The moderately poor households from the second wealth quartile show the greatest response to shocks, but the extremely poor household from the first wealth quartile have little scope to decrease their dietary diversity which is already very low. While own food production might alleviate food insecurity of the poorest, it does not insulate them form the weather and food price shocks. Our findings are robust to employing self-reported measures of food security.