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How Vulnerable are Arab Countries to Global Food Price Shocks?

Author

Listed:
  • Ianchovichina, Elena
  • Loening, Josef
  • Wood, Christina

Abstract

This paper presents new estimates of pass-through coefficients from international to domestic food prices by country in the Middle East and North Africa (MENA). The estimates indicate that, despite the use of food price subsidies and other government interventions, a rise in global food prices is transmitted to a significant degree into domestic food prices in many MENA countries, although cross-country variation is significant. In nearly all countries, domestic food prices are highly downwardly rigid. The finding of asymmetric price transmission suggests that not only international food price levels matter, but also food price volatility. High food pass-through tends to increase inflation pressures, where food consumption shares are high. Domestic factors, often linked to storage, logistics, and procurement, have also played a major role in explaining high food inflation in the majority of MENA countries.

Suggested Citation

  • Ianchovichina, Elena & Loening, Josef & Wood, Christina, 2012. "How Vulnerable are Arab Countries to Global Food Price Shocks?," Conference papers 332211, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
  • Handle: RePEc:ags:pugtwp:332211
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    File URL: https://ageconsearch.umn.edu/record/332211/files/5677.pdf
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    References listed on IDEAS

    as
    1. Luca ONORANTE & Gianluigi FERRUCCI & Rebeca JIMÉNEZ-RODRÍGUEZ, 2010. "Food Price Pass-Through in the Euro Area: the Role of Asymmetries and Non-Linearities," EcoMod2010 259600125, EcoMod.
    2. Breisinger, Clemens & Ecker, Olivier & Al-Riffai, Perrihan, 2011. "Economics of the Arab awakening: From revolution to transformation and food security," Policy briefs 18, International Food Policy Research Institute (IFPRI).
    3. Breisinger, Clemens & Ecker, Olivier & Al-Riffai, Perrihan, 2011. "Economics of the Arab awakening [in Arabic]: From revolution to transformation and food security," Policy briefs 18 AR, International Food Policy Research Institute (IFPRI).
    4. Friederike Greb & Nelissa Jamora & Carolin Mengel & Stephan von Cramon-Taubadel & Nadine Würriehausen, 2012. "Price transmission from international to domestic markets," Courant Research Centre: Poverty, Equity and Growth - Discussion Papers 125, Courant Research Centre PEG, revised 08 Oct 2012.
    5. Isabel Ortiz & Jingqing Chai & Matthew Cummins, 2011. "Escalating Food Prices: The threat to poor households and policies to safeguard a Recovery for All," Working papers 1101, UNICEF,Division of Policy and Strategy.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Demand and Price Analysis; Consumer/Household Economics;

    JEL classification:

    • O23 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Fiscal and Monetary Policy in Development
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • N15 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Asia including Middle East
    • N17 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Africa; Oceania

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