Between January 2006 and April 2008, the prices of most agricultural products rose considerably in international markets. Empirical studies show that this spike in world food prices increased the number of poor households in developing countries, but the extent was not the same in all countries. This article assesses the impact of rising rice prices on poverty and income inequality in Burkina Faso, using a methodology based on the concept of compensating variation combined with the net benefit ratio (NBR) developed by Deaton (1989) and a living standard survey (QUIBB, 2003). The results show that higher prices have a negative impact on income and poverty in the regions with a large proportion of households that are net buyers of rice. The poverty rate increases by 2.2 to 2.9 percentage points depending on the assumptions, the increase being higher in urban areas than in rural areas. Rising rice prices also increase income inequality, which increases particularly in urban areas and in relatively rich regions, but decreases in poor regions with a large proportion of rice producers.
Access to high-quality data is a key component for research and subsequent policy recommendations; however, accurate trade data capturing intra-African trade is not consistently available to researchers, even in commonly used databases such as UN COMTRADE. Formally reported country-level trade data can be reported at erratic intervals, is frequently inaccurate, and generally does not account for informal trade. Several studies (Ama, Mangadi, and Ama 2014; Ogalo 2010; INSAE 2011 and 2012; Bensassi et al. 2016a and b) suggest that informal cross-border trade (ICBT) can meet or even exceed the value of formal trade in certain trade corridors. This shows how important ICBT is to economies, and how important it is to get an accurate measurement.
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