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Rising Staple Prices and Food Insecurity: The Case of the Mexican Tortilla

Author

Listed:
  • Camilo Bohorquez-Penuela

    () (Banco de la República de Colombia)

  • Mariana Urbina-Ramirez

    ()

Abstract

We study the relationship between rising prices of tortilla - the Mexican staple par excellence - and household food insecurity between 2008 and 2014, a period in which global food prices experienced dramatic increases. The use of a unique combination of household-level data and oficial state-level information on prices allows us exploit significant variation in prices across the Mexican states. Since households cannot be tracked across time, we follow Deaton (1985) by constructing a series of pseudo-panels to control for time-invariant unobserved heterogeneity and measurement error. The regression estimates suggest that increasing tortilla prices affected food insecurity rates in Mexico. More specifically, households with children or those in the second or third income quintile are more likely to be affected. **** RESUMEN: Estudiamos la relación entre el aumento de precios de la tortilla - el alimento esencial por excelencia en México - y la inseguridad alimentaria de los hogares entre 2008 2014, un periodo en el que los precios globales de los alimentos sufrieron incrementos extraordinarios. El uso de una combinación única de datos de encuestas de hogares e información oficial de precios por estados nos permite explotar una variación significativa a través de las distintas unidades administrativas del territorio mexicano. Dado que los hogares no pueden ser seguidos a través del tiempo, nos apoyamos en Deaton (1985) para construir una serie de pseudo-páneles para controlar en nuestras estimaciones por error de medición y heterogeneidad no observada que no varía con el tiempo. Los estimadores sugieren que el incremento de los precios de la tortilla aumentó la inseguridad alimentaria en México, principalmente en hogares con niños y aquellos que se ubican en el segundo y tercer quintil de la distribución de ingresos per cápita.

Suggested Citation

  • Camilo Bohorquez-Penuela & Mariana Urbina-Ramirez, 2020. "Rising Staple Prices and Food Insecurity: The Case of the Mexican Tortilla," Borradores de Economia 1144, Banco de la Republica de Colombia.
  • Handle: RePEc:bdr:borrec:1144
    DOI: https://doi.org/10.32468/be.1144
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    References listed on IDEAS

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    1. Craig Gundersen & Brent Kreider & John Pepper, 2011. "The Economics of Food Insecurity in the United States," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 33(3), pages 281-303.
    2. Jose Cuesta & Hugo Ñopo & Georgina Pizzolitto, 2011. "Using Pseudo‐Panels To Measure Income Mobility In Latin America," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 57(2), pages 224-246, June.
    3. Jere R. Behrman & Alejandro Gaviria & Miguel Székely, 2001. "Intergenerational Mobility in Latin America," ECONOMIA JOURNAL OF THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION, ECONOMIA JOURNAL OF THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION, vol. 0(Fall 2001), pages 1-44, August.
    4. Francisca Antman & David McKenzie, 2007. "Poverty traps and nonlinear income dynamics with measurement error and individual heterogeneity," Journal of Development Studies, Taylor & Francis Journals, vol. 43(6), pages 1057-1083.
    5. Deaton, Angus, 1985. "Panel data from time series of cross-sections," Journal of Econometrics, Elsevier, vol. 30(1-2), pages 109-126.
    6. Bellemare, Marc F. & Fajardo-Gonzalez, Johanna & Gitter, Seth R., 2018. "Foods and fads: The welfare impacts of rising quinoa prices in Peru," World Development, Elsevier, vol. 112(C), pages 163-179.
    7. Derek Headey & Shenggen Fan, 2008. "Anatomy of a crisis: the causes and consequences of surging food prices," Agricultural Economics, International Association of Agricultural Economists, vol. 39(s1), pages 375-391, November.
    8. Jere R. Behrman & Alejandro Gaviria & Miguel Székely, 2001. "Intergenerational Mobility in Latin America," Economía Journal, The Latin American and Caribbean Economic Association - LACEA, vol. 0(Fall 2001), pages 1-44, August.
    9. Hadley, Craig & Stevenson, Edward Geoffrey Jedediah & Tadesse, Yemesrach & Belachew, Tefera, 2012. "Rapidly rising food prices and the experience of food insecurity in urban Ethiopia: Impacts on health and well-being," Social Science & Medicine, Elsevier, vol. 75(12), pages 2412-2419.
    10. Dahan, Momi & Gaviria, Alejandro, 2001. "Sibling Correlations and Intergenerational Mobility in Latin America," Economic Development and Cultural Change, University of Chicago Press, vol. 49(3), pages 537-554, April.
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    More about this item

    Keywords

    Mexico; food insecurity; food prices; households; México; inseguridad alimentaria; precios de alimentos; hogares;

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean
    • Q11 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Aggregate Supply and Demand Analysis; Prices
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy

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