The impacts of food price and income shocks on household food security and economic well-being: Evidence from rural Bangladesh |
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| Institution: | 1. Department of Economics, Helmholtz Centre for Environmental Research – UFZ, Leipzig, Germany;2. Social Sciences Division, International Rice Research Institute, Los Baños, Laguna 4031, Philippines;3. Fikra Consulting and Research, PO Box 2664, Doha, Qatar;1. Department of Ecology, Evolution, and Environmental Biology, Columbia University, 1200 Amsterdam Ave., New York, NY 10027, USA;2. Agriculture and Food Security Center, The Earth Institute, Columbia University, 61 Route 9W, Palisades, NY 10964, USA;3. School of International and Public Affairs, Columbia University, 420 W 118th Street, New York, NY 10025, USA;4. Climate Change Agriculture and Food Security Program, World Agroforestry Centre, PO Box 30677, Nairobi 00100, Kenya;1. Department of Environmental Studies and Sciences, Santa Clara University, 500 El Camino Real, Santa Clara, CA 95050-4901, USA;2. Department of Economics, Santa Clara University, 500 El Camino Real, Santa Clara, CA 95053, USA;3. Community Agroecology Network, 595 Franklin Street, Santa Clara, CA 95050, USA;4. Environmental Program and Plant and Soil Science Department, University of Vermont, The Bittersweet – 153 South Prospect Street, Burlington, VT 05401, USA;5. International Development, Community, & Environment Department, Clark University, 950 Main Street, Worcester, MA 01610, USA;1. Potsdam Institute for Climate Impact Research, P.O. Box 60 12 03, 14412 Potsdam, Germany;2. Wageningen University and Research Centre, Sociology of Development and Change, Hollandseweg 1 – Bode 18, NL-6706 KN Wageningen, The Netherlands;1. Poverty, Health and Nutrition Division, International Food Policy Research Institute, 1201 Eye St NW, Washington, DC 20005, USA;2. Agriculture for Nutrition and Health (A4NH) and Poverty, Health and Nutrition Division, International Food Policy Research Institute, 1201 Eye St NW, Washington, DC 20005, USA |
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| Abstract: | This paper examines the combined impacts of food price and income shocks on household food security and economic well-being in low-income rural communities. Using longitudinal survey data of 1800 rural households from 12 districts of Bangladesh over the period 2007–2009, we estimated a three-stage hierarchical logit model to identify the key sources of household food insecurity. The first-difference estimator was then employed to compare pre- and post-shock expenditure for those households that experienced acute food shortages and those that managed to avoid the worst impacts of the shocks. On the basis of our results we conclude that: (1) the soaring food prices of 2007–2009 unequivocally aggravated food insecurity in the rural areas of Bangladesh; (2) the subsequent income shocks of 2007–2009 contributed toward worsening food insecurity; (3) the adverse impacts of these shocks appeared to have faded over time due to labor and commodity market adjustments, regional economic growth, and domestic policy responses, leaving no profound impacts on households’ economic well-being in most cases; and (4) although the immediate adverse consequences of rising food prices were borne disproportionately by the poor, the longer term consequences were distributed more evenly across the rich and poor and were favorable for the day laborers. |
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| Keywords: | Food price shock Income shock Global food crisis Global financial crisis Nested logit model First difference estimator |
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