The Impact Of Food Inflation On Urban Poverty And Its Monetary Cost

Some Back-Of-The-Envelope Calculations

Bibliographic Data

ID19934375
AuthorsSébastien Dessus (World Bank), Santiago Herrera (0000-0003-2634-1586), Rafael De Hoyos
Year2008
Publication date2008-07-01
Open AccessNo
TypeBOOK
PublisherWorld Bank, Washington, DC (PUBLISHER)
DOI10.1596/1813-9450-4666
OpenAlexW2050238828
LanguageEN
Citations received3
References cited2

This paper uses a sample of 73 developing countries to estimate the change in the cost of alleviating urban poverty brought about by the recent increase in food prices. This cost is approximated by the change in the poverty deficit, that is, the variation in financial resources required to eliminate poverty under perfect targeting. The results show that, for most countries, the cost represents less than 0.1 percent of gross domestic product. However, in the most severely affected, it may exceed 3 percent. In all countries, the change in the poverty deficit is mostly due to the negative real income effect of those households that were poor before the price shock, while the cost attributable to new households falling into poverty is negligible. Thus, in countries where transfer mechanisms with effective targeting already exist, the most cost-effective strategy would be to scale up such programs rather than designing tools to identify the new poor

Agriculture · Cost of living · Demographic economics · Developing country · Development economics · Economic growth · Economics · Falling (accident) · Food prices · Food security · Geography · Gross domestic product · Inflation (cosmology) · Macroeconomics · Poverty · Shock (circulatory) · Economics of Agriculture and Food Markets · Fiscal Policy and Economic Growth · Income, Poverty, and Inequality

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