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The financial crisis and its impacts on global agriculture

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  • Lin , Justin Yifu
  • Martin, Will

Abstract

The financial crisis arose in the industrial countries, but has affected developing countries through higher interest rates, sharp changes in commodity prices, and reductions in investment, trade, migration and remittances. For most low-income countries, shocks that affect food prices or wage rates for unskilled workers seem likely to have the largest impact on poverty, with the declines in key food prices associated with the crisis helping to reduce poverty, while declining trade, investment, and remittance flows have had adverse impacts on the poor. Policies to address the crisis must include measures to deal with financial sector problems, the resulting reductions in aggregate demand, and the particular vulnerabilities of poor people. Given the complexity of the impacts from financial crises and commodity price shocks, there is a strong case for developing better social safety net policies that can offset the adverse impacts of a wide range of different shocks on poor people without creating costly market distortions.

Suggested Citation

  • Lin , Justin Yifu & Martin, Will, 2010. "The financial crisis and its impacts on global agriculture," Policy Research Working Paper Series 5431, The World Bank.
  • Handle: RePEc:wbk:wbrwps:5431
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    References listed on IDEAS

    as
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    3. Emmanuel Farhi & Ricardo Caballero & Pierre-Olivier Gourinchas, "undated". "Financial Crash, Commodity Prices and Global Imbalances," Working Paper 20933, Harvard University OpenScholar.
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    Cited by:

    1. Derek Headey & Sangeetha Malaiyandi & Shenggen Fan, 2010. "Navigating the perfect storm: reflections on the food, energy, and financial crises," Agricultural Economics, International Association of Agricultural Economists, pages 217-228.
    2. Canova, Natalia P. & Hickey, Gordon M., 2012. "Understanding the impacts of the 2007–08 Global Financial Crisis on sustainable forest management in the Brazilian Amazon: A case study," Ecological Economics, Elsevier, vol. 83(C), pages 19-31.

    More about this item

    Keywords

    Emerging Markets; Debt Markets; Economic Theory&Research; Markets and Market Access; Currencies and Exchange Rates;

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