Market proximity, resilience, and food security: A cross-country empirical analysis

Scholars advocate that proximity to final markets increases food security, but empirical evidence is scarce. We shed light on this issue by applying a hybrid empirical approach – which combines machine learning algorithms, vulnerability models and mediation analysis – to a new cross-country household dataset made available by the International Fund for Agricultural Development in 2017-2018. Specifically, we find positive and statistically significant associations among proximity to markets, resilience and food security. We tested the plausibility of the exclusion restriction that market proximity does not affect food security fluctuations other than through its impact on resilience capacity by implementing an instrumental variable approach and a mediation analysis. The latter method reveals that market proximity accounts for a significant share of the positive correlation between household resilience and food security outcomes. The dampening role played by market proximity in decreasing welfare fluctuations is also confirmed when replacing food security outcomes with income ones. Overall, these findings suggest that policymakers should prioritize interventions to improve infrastructure and access to markets as a means to boost household resilience and, in turn, decrease welfare fluctuations and vulnerability to food insecurity.