Are smallholder farmers better or worse off from an increase in the international price of cereals?

Abstract

The effect of agricultural price shocks on household welfare in low-income countries is a major concern for policymakers attempting to reduce poverty rates. This study estimates the impact of an increase in the world cereal price on rural households in Burkina Faso in an agricultural household model framework. We account for imperfect transmission of global prices to local prices as well as supply and demand response of rural households to price signals. The increase in price during the

Impacts of price, weather and policy changes on maize and rice farming in Togo

“…These estimates are higher than the worldwide maize (0.069) and rice (0.024) acreage elasticities estimated by Haile et al (2016). However, they are in range with those found by Nakelse et al (2018) in Burkina-Faso where the acreage responses are 1.14 and 1.29 for maize and rice respectively. The coefficient of the fertilizer price index is negative (−0.21) and statistically significant only for maize.…”

“…Since the turn of the third millennium, the world has experienced a few major food crises associated with food price increases. In between 1990 and 2015, food crises took place in 1991 in Malawi (Dorward and Kydd, 2004), in 1997 in Indonesia (Waters et al , 2003), in 2005 in West Africa (Hampshire et al , 2009; worldwide in 2008), in 2006, 2008, 2011 worldwide (WFP and FAO, 2009; Timmer, 2010; Nakelse et al , 2018) and were associated with food riots in several developing countries (Bellemare, 2015). Boansi (2013) and (Boansi, 2014) estimated the acreage response of rice to some selected price and non-price factors in Ivory Coast and Nigeria.…”

Integration Rice Price And Farmers Welfare With Error Correction Model Analysis

“…As noted, the previous two studies lack the time series perspective of our research. Nakelse et al (2018) conclude that food cereal prices correlate positively with household welfare, but we show that prices of rice during the period studied connect significantly with farmers' short-run but not long-term welfare.…”

“…Results show that rice prices influence farmers' welfare in the short run but not the long run. Vu and Glewwe (2011) and Minot and Dewina (2013) and refines those of Nakelse et al (2018) that food prices correlate positively farmer's welfare. As noted, the previous two studies lack the time series perspective of our research.…”

“…Their results showed that the direct effects of rising food prices on the welfare of farmers in Java and Bali are more significant than for those who live outside of Java. Nakelse, Dalton, Hendricks, & Hodjo (2018) analyze the implications of world cereal price shocks on the welfare of rural households in Burkina Faso. The causal relationship between the world and domestic cereal prices is formed using the Error Correction Framework to measure and separate the short-term and long-term effects on local prices from changes in world prices.…”