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International food prices and poverty in Indonesia

Author

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  • Peter Warr
  • Arief Anshory Yusuf

Abstract

This paper argues that recent increases in international food prices worsened poverty incidence in Indonesia, even though many poor farmers benefited. This conclusion is based on the application of a multi-sectoral, multihousehold general equilibrium model of the Indonesian economy. The positive effect on the welfare of poor farmers was exceeded by the negative effect on poor consumers. Indonesia’s ban on rice imports since 2004 complicates this account. The import ban shielded Indonesia’s internal rice market from the temporary world price increases from 2007 to 2008, but did so at the expense of permanently increasing both rice prices and poverty incidence.

Suggested Citation

  • Peter Warr & Arief Anshory Yusuf, 2009. "International food prices and poverty in Indonesia," Departmental Working Papers 2009-19, The Australian National University, Arndt-Corden Department of Economics.
  • Handle: RePEc:pas:papers:2009-19
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    References listed on IDEAS

    as
    1. Peter Warr, 2008. "World food prices and poverty incidence in a food exporting country: a multihousehold general equilibrium analysis for Thailand," Agricultural Economics, International Association of Agricultural Economists, vol. 39(s1), pages 525-537, November.
    2. George Fane & Peter Warr, 2008. "Agricultural Protection In Indonesia," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 44(1), pages 133-150.
    3. Decaluwe, B. & Patry, A. & Savard, L. & Thorbecke, E., 1999. "Poverty Analysis Within a General Equilibrium Framework," Cahiers de recherche 9909, Université Laval - Département d'économique.
    4. George Fane & Peter Warr, 2002. "How Economic Growth Reduces Poverty: A General Equilibrium Analysis for Indonesia," WIDER Working Paper Series DP2002-19, World Institute for Development Economic Research (UNU-WIDER).
    5. Arief Anshory Yusuf, 2006. "Constructing Indonesian Social Accounting Matrix for Distributional Analysis in the CGE Modelling Framework," Working Papers in Economics and Development Studies (WoPEDS) 200604, Department of Economics, Padjadjaran University, revised Nov 2006.
    6. Warr, Peter G., 2005. "Food policy and poverty in Indonesia: a general equilibrium analysis," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 49(4), pages 1-23.
    7. Warr, Peter G., 2005. "Food Policy And Poverty: A General Equilibrium Analysis For Indonesia," 2005 Conference (49th), February 9-11, 2005, Coff's Harbour, Australia 139296, Australian Agricultural and Resource Economics Society.
    8. Mark Horridge, 2000. "ORANI-G: A General Equilibrium Model of the Australian Economy," Centre of Policy Studies/IMPACT Centre Working Papers op-93, Victoria University, Centre of Policy Studies/IMPACT Centre.
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    Citations

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    Cited by:

    1. Teguh Dartanto, 2010. "Volatility of World Rice Prices, Import Tariffs and Poverty in Indonesia : A CGE-Microsimulation Analysis," Economics and Finance in Indonesia, Faculty of Economics and Business, University of Indonesia, vol. 58, pages 335-364, December.
    2. Warr, Peter G., 2012. "Research and agricultural productivity in Indonesia," 2012 Conference (56th), February 7-10, 2012, Fremantle, Australia 124475, Australian Agricultural and Resource Economics Society.
    3. Djoni Hartono & Tony Irawan & Ahmad Komarulzaman, 2014. "Energy Pricing Policies in Indonesia: A Computable General Equilibrium Model," EcoMod2014 7344, EcoMod.
    4. Teguh Dartanto & Usman, 2011. "Volatility of World Soybean Prices, Import Tariffs and Poverty in Indonesia," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 5(2), pages 139-181, May.

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    More about this item

    Keywords

    Indonesia; food prices; poverty incidence; general equilibrium modeling;
    All these keywords.

    JEL classification:

    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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