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The impact of large-scale social protection interventions on grain prices in poor countries: Evidence from Ethiopia

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  • Hoddinott, John F.
  • Stifel, David
  • Hirvonen, Kalle
  • Minten, Bart

Abstract

There has long been concern that cash and in-kind transfers might affect prices in developing country food markets. While there have been a number of studies at highly aggregated levels, much less is known about the effects of cash transfers on local food prices and even less about how they compare to food transfers. We consider this issue in the context of a large social protection intervention, Ethiopia’s Productive Safety Net Programme. Using 12 months of price data from 233 localities and controlling for temporal, location, and market characteristics we find: Cash transfers have no effect on food prices. There is some evidence that food transfers reduce food prices. Maize transfers reduce aggregate grain prices, wheat transfers reduce the price of maize, and the negative effect of food transfers on food prices is larger in more remote markets. However, the magnitudes of these effects are trivially small, both in absolute and percentage terms.

Suggested Citation

  • Hoddinott, John F. & Stifel, David & Hirvonen, Kalle & Minten, Bart, 2018. "The impact of large-scale social protection interventions on grain prices in poor countries: Evidence from Ethiopia," ESSP working papers 116, International Food Policy Research Institute (IFPRI).
  • Handle: RePEc:fpr:esspwp:116
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    Citations

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    Cited by:

    1. Hirvonen, Kalle & Hoddinott, John F., 2018. "Payment modality preferences: Evidence from Ethiopia’s Productive Safety Net Programme," ESSP working papers 125, International Food Policy Research Institute (IFPRI).
    2. Gautam, Yograj, 2019. "“Food aid is killing Himalayan farms”. Debunking the false dependency narrative in Karnali, Nepal," World Development, Elsevier, vol. 116(C), pages 54-65.
    3. Alan Gelb & Vijaya Ramachandran & Christian J. Meyer & Divyanshi Wadhwa & Kyle Navis, 2020. "Can Sub-Saharan Africa Be a Manufacturing Destination? Labor Costs, Price Levels, and the Role of Industrial Policy," Journal of Industry, Competition and Trade, Springer, vol. 20(2), pages 335-357, June.

    More about this item

    Keywords

    ETHIOPIA; EAST AFRICA; AFRICA SOUTH OF SAHARA; AFRICA; food prices; poverty; food security; nutrition programmes; food policies; food transfer; cash transfers; Productive Safety Net Programme; social protection; D40 Market Structure and Pricing: General; I38 Welfare; Well-Being; and Poverty: Government Programs; Provision and Effects of Welfare Programs; O12 Microeconomic Analyses of Economic Development;
    All these keywords.

    JEL classification:

    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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