Are Low Food Prices Pro-Poor? Net Food Buyers and Sellers in Low-Income Countries

By M. Ataman Aksoy, Aylin Isik-Dikmelik. 2008

172 citations recorded by the source corpus.

There is a general consensus that most of the poor in developing countries are net food buyers and food price increases are bad for the poor. This could be expected of urban poor, but it is also often attributed to the rural poor. Recent food price increases have increased the importance of this issue, and the possible policy responses to these price increases. This paper examines the characteristics of net food sellers and buyers in nine low-income countries. Although the largest share of poor households are found to be net food buyers, almost 50 percent of net food buyers are marginal net food buyers who would not be significantly affected by food price increases. Only three of the nine countries examined exhibited a substantial proportion of vulnerable households. The average incomes (as measured by expenditure) of net food buyers were found to be higher than net food sellers in eight of the nine countries examined. Thus, food price increases, ceteris paribus, would transfer income from generally higher income net food buyers to poorer net food sellers. The analysis also finds that the occupations and income sources of net sellers and buyers in rural areas are significantly different. In rural areas where food production is the main activity and where there are limited non-food activities, the incomes of net buyers might depend on the incomes and farming activities of net food sellers. These results suggest the need for reevaluation of the consensus on the impact of food prices on food needs. Further work on the regional differences, and more important, on the second order effects, are necessary to answer these questions more precisely. Only on the basis of further analysis can we start generating better policy responses.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/8396e9337c4bc8bf2cbccdf81845dfb777a14ca1

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Citations in the corpus

Reflections on the Global Food Crisis: how did it happen? how has it hurt? and how can we prevent the next one? (2010, background): “Is it possible that these surveys overestimate net food consumers? Aksoy and Isik-Dikmelik (2008) also analyze household surveys (including some of the surveys analyzed by Ivanic and Martin [2008]) and conclude that (i) although”
The geographic and sectoral patterns of large-scale farmland investments in sub-Saharan Africa (2014, background): “For net food buying households, which in many African countries is the majority of the rural population, food price fluctuations can severely undermine household capacity to meet basic needs (Aksoy and Isik-Dikmelik, 2008).”
The impact of rising food prices on the poor (2008, methodology): “Rios et al. (2008a) analyze the possible welfare impact on poor farmers using household survey data from three countries, while Aksoy and Isik-Dikmelik (2008) make a ―first pass‖ at characterizing the welfare impacts of food prices on net food buyers and sellers.”
Land Sparing Versus Land Sharing: Moving Forward (2014, background): “Aksoy, M.A. & Isik-Dikmelik, A. (2008). Are low food prices”
Rising Food Prices and Undernourishment - A Cross-Country Inquiry (2013, background): “The evidence presented in Aksoy and Izik-Dikmelik (2008), Ivanic and Martin (2008), and Zezza et al. (2008) and this paper demonstrates that in general the poorer suffer more from higher food prices, given their general net-food buyer position and less diversified diets. However, such a generalizati”
Impacts in Uganda of rising global food prices: the role of diversified staples and limited price transmission (2008, background): “On the other hand, some rural households in Uganda will gain from higher food prices both directly and through the effects on wages and local demand for nonfarm goods arising from the increased income of netseller households (Aksoy and Isik-Dikmelik, 2008).”
Self-Reported Food Insecurity in Africa During the Food Price Crisis (2013, result): “These results are challenged by Aksoy and Isik-Dikmelik (2008), who assume that many of the poorest in rural areas are mostly net food sellers.”