On the effects of COVID-19 on food prices in India: a time-varying approach

Abstract

Since the inception of the novel coronavirus, immense research efforts have been made to understand how several economic indicators, including food security, would be affected. With India racing behind the United States in terms of daily infection rate and being a country with challenging food security issues, it is important to investigate how the presence of the pandemic has influenced the dynamics of food prices in the country. This paper considers seven price series from 167 markets across the five regions in India as well as the growth rate of COVID-19 infection. The paper uses a time-varying autoregressive model to investigate the nonlinear dynamics of food prices in relation to the pandemic in India. The resultant models reveal strong asymmetric properties with shock-inflicted persistence, which appear not to converge over the simulation period. Moreover, in terms of the location of the burden of the pandemic impact, we find a food product divide.

Price Dynamics and Integration in India’s Staple Food Commodities—Evidence from Wholesale and Retail Rice and Wheat Markets

“…Also, bi-directional price transmission indicates the quick response of retail prices to any change in the wholesale prices. An extensive literature examined the rice and wheat prices in India in the past [2,9,[12][13][14][16][17][18][19][20][21][22][23][24][25] and, recently, a few studies focused on asymmetric price transmission [14] and distortion in prices due to COVID-19 [32,33]. The main finding of this paper on price cointegration is consistent with other studies [14,[23][24][25].…”

“…It is surprising to note that the structural break did not coincide with the expected 2008 financial crisis or the recentpast COVID-19 pandemic. This indirectly implies that the Government intervention in these staples at regular intervals through price policies safeguarded the food sector from unwarranted fluctuations [33] and social unrest.…”

“…In the recent past, price instability was observed owing to the COVID-19 incidence [32]. However, no major distortion was also reported [33] due to the Government's control through the operation of minimum support price.…”

“…Although various disruptions [28,29] in the supply chain have been observed, many agricultural markets have performed efficiently [30,31] because of timely intervention as agricultural commodities were essential for life sustenance. Thus, in this study, we have been motivated to analyze these aspects, and, in the recent past, questions have arisen about to what extent the agricultural value chain of India's staple foods has deviated or adjusted under the pandemic situation [32,33] and, also, if any such situation may arise in the future. Given the complexities of price behavior in the wholesale and retail markets, a thorough evaluation of the price dynamics and integration will aid in prioritizing investments, removing distortions, and adopting policies to improve overall performance.…”

COVID-19 and non-communicable diseases: GMM/IV Panel VAR evidence from US states

“…In the spirit of Emediegwu and Nnadozie (2023), I transform death cases into their week-on-week (WoW) logdifferenced values to ease the interpretation of the impulse-responses in percentage terms and for policy relevance. I calculate the growth rate of mortality (𝑔 𝑖𝑡 ) as…”