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Covid-19 and Food Protectionism : The Impact of the Pandemic and Export Restrictions on World Food Markets

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  • Espitia,Alvaro
  • Rocha,Nadia
  • Ruta,Michele

Abstract

This paper analyzes the impact of Covid-19 and uncooperative trade policies on world food markets. It quantifies the initial shock due to the pandemic under the assumption that products that are more labor intensive in production are more affected through workers' morbidity and containment policies. It then estimates how escalating export restrictions to shield domestic food markets could magnify the initial shock. The analysis shows that, in the quarter following the outbreak of the pandemic, the global export supply of food could decrease between 6 and 20 percent and global prices increase between 2 and 6 percent on average. Escalating export restrictions would multiply the initial shock by a factor of 3, with world food prices rising by up to 18 percent on average. Import food dependent countries, which are in large majority developing and least developed countries, would be most affected.

Suggested Citation

  • Espitia,Alvaro & Rocha,Nadia & Ruta,Michele, 2020. "Covid-19 and Food Protectionism : The Impact of the Pandemic and Export Restrictions on World Food Markets," Policy Research Working Paper Series 9253, The World Bank.
  • Handle: RePEc:wbk:wbrwps:9253
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    References listed on IDEAS

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    1. Giordani, Paolo E. & Rocha, Nadia & Ruta, Michele, 2016. "Food prices and the multiplier effect of trade policy," Journal of International Economics, Elsevier, vol. 101(C), pages 102-122.
    2. Will Martin & Kym Anderson, 2012. "Export Restrictions and Price Insulation During Commodity Price Booms," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 94(2), pages 422-427.
    3. Tovar, Patricia, 2009. "The effects of loss aversion on trade policy: Theory and evidence," Journal of International Economics, Elsevier, vol. 78(1), pages 154-167, June.
    4. Lionel Fontagné & Houssein Guimbard & Gianluca Orefice, 2019. "Product-level Trade Elasticities," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-02444897, HAL.
    5. Caroline Freund & Caglar Ozden, 2008. "Trade Policy and Loss Aversion," American Economic Review, American Economic Association, vol. 98(4), pages 1675-1691, September.
    6. Angel Aguiar & Maksym Chepeliev & Erwin L. Corong & Robert McDougall & Dominique van der Mensbrugghe, 2019. "The GTAP Data Base: Version 10," Journal of Global Economic Analysis, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, vol. 4(1), pages 1-27, June.
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    RePEc Biblio mentions

    As found on the RePEc Biblio, the curated bibliography for Economics:
    1. > Economics of Welfare > Health Economics > Economics of Pandemics > Specific pandemics > Covid-19 > Trade and Globalization

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    Cited by:

    1. Samuel Kwaku Agyei & Zangina Isshaq & Siaw Frimpong & Anokye Mohammed Adam & Ahmed Bossman & Oliver Asiamah, 2021. "COVID‐19 and food prices in sub‐Saharan Africa," African Development Review, African Development Bank, vol. 33(S1), pages 102-113, April.

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    Keywords

    International Trade and Trade Rules; Trade and Multilateral Issues; Trade Policy; Rules of Origin; Climate Change and Agriculture; Crops and Crop Management Systems;
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