Food prices and the wages of the poor: A low-cost, high-value approach to high-frequency food security monitoring
International food prices have become increasingly volatile in recent decades, with “global food crises” in 2008, 2011 and most recently in 2022. The 2008 crisis prompted international agencies to ambitiously extend their monitoring of domestic food prices in developing countries to strengthen early...
| Main Authors: | , , , , |
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| Format: | Artículo preliminar |
| Language: | Inglés |
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International Food Policy Research Institute
2023
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| Online Access: | https://hdl.handle.net/10568/129751 |
| _version_ | 1855525865977282560 |
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| author | Headey, Derek D. Bachewe, Fantu Nisrane Marshall, Quinn Raghunathan, Kalyani Mahrt, Kristi |
| author_browse | Bachewe, Fantu Nisrane Headey, Derek D. Mahrt, Kristi Marshall, Quinn Raghunathan, Kalyani |
| author_facet | Headey, Derek D. Bachewe, Fantu Nisrane Marshall, Quinn Raghunathan, Kalyani Mahrt, Kristi |
| author_sort | Headey, Derek D. |
| collection | Repository of Agricultural Research Outputs (CGSpace) |
| description | International food prices have become increasingly volatile in recent decades, with “global food crises” in 2008, 2011 and most recently in 2022. The 2008 crisis prompted international agencies to ambitiously extend their monitoring of domestic food prices in developing countries to strengthen early warning systems and food and nutrition surveillance. However, food inflation by itself is not sufficient for measuring disposable income or food affordability; for that, one must measure either changes in income or changes in an income proxy. Here we propose the use of a low-cost income proxy that can be monitored at the same high frequency and spatial granularity as food prices: the wages of poor unskilled workers. While not all poor people are unskilled wage earners, changes in the real “reservation wages” of low skilled activities are likely to be highly predictive of changes in disposable income for poorer segments of society (Deaton and Dreze 2002). We demonstrate this by estimating changes in “food wages” – wages deflated food price indices – during well-documented food price crises in Ethiopia (2008, 2011 and 2022), Sri Lanka (2022) and Myanmar (2022). In all these instances, food wages declined by 20-30%, often in the space of a few months. Moreover, in Myanmar we use a household panel survey data to show that the decline in food wages over the course of 2022 closely matches estimate declines in household disposable income and proportional increases in income-based poverty. We argue that the affordability of nutritious food for “all people, at all times” is a critically important dimension of food security, and we advocate for monitoring the wages of the poor as a cheap and accurate means of capturing that dimension. |
| format | Artículo preliminar |
| id | CGSpace129751 |
| institution | CGIAR Consortium |
| language | Inglés |
| publishDate | 2023 |
| publishDateRange | 2023 |
| publishDateSort | 2023 |
| publisher | International Food Policy Research Institute |
| publisherStr | International Food Policy Research Institute |
| record_format | dspace |
| spelling | CGSpace1297512025-12-02T21:02:52Z Food prices and the wages of the poor: A low-cost, high-value approach to high-frequency food security monitoring Headey, Derek D. Bachewe, Fantu Nisrane Marshall, Quinn Raghunathan, Kalyani Mahrt, Kristi food prices crises food security nutrition wages diets monitoring inflation household income early warning systems International food prices have become increasingly volatile in recent decades, with “global food crises” in 2008, 2011 and most recently in 2022. The 2008 crisis prompted international agencies to ambitiously extend their monitoring of domestic food prices in developing countries to strengthen early warning systems and food and nutrition surveillance. However, food inflation by itself is not sufficient for measuring disposable income or food affordability; for that, one must measure either changes in income or changes in an income proxy. Here we propose the use of a low-cost income proxy that can be monitored at the same high frequency and spatial granularity as food prices: the wages of poor unskilled workers. While not all poor people are unskilled wage earners, changes in the real “reservation wages” of low skilled activities are likely to be highly predictive of changes in disposable income for poorer segments of society (Deaton and Dreze 2002). We demonstrate this by estimating changes in “food wages” – wages deflated food price indices – during well-documented food price crises in Ethiopia (2008, 2011 and 2022), Sri Lanka (2022) and Myanmar (2022). In all these instances, food wages declined by 20-30%, often in the space of a few months. Moreover, in Myanmar we use a household panel survey data to show that the decline in food wages over the course of 2022 closely matches estimate declines in household disposable income and proportional increases in income-based poverty. We argue that the affordability of nutritious food for “all people, at all times” is a critically important dimension of food security, and we advocate for monitoring the wages of the poor as a cheap and accurate means of capturing that dimension. 2023-03-22 2023-03-23T19:23:40Z 2023-03-23T19:23:40Z Working Paper https://hdl.handle.net/10568/129751 en https://doi.org/10.2499/p15738coll2.136457 https://doi.org/10.2499/p15738coll2.133638 https://hdl.handle.net/10568/153897 Open Access application/pdf International Food Policy Research Institute Headey, Derek D.; Bachewe, Fantu Nisrane; Marshall, Quinn; Raghunathan, Kalyani; and Mahrt, Kristi. 2023. Food prices and the wages of the poor: A low-cost, high-value approach to high-frequency food security monitoring. IFPRI Discussion Paper 2174. Washington, DC: International Food Policy Research Institute (IFPRI). https://doi.org/10.2499/p15738coll2.136614 |
| spellingShingle | food prices crises food security nutrition wages diets monitoring inflation household income early warning systems Headey, Derek D. Bachewe, Fantu Nisrane Marshall, Quinn Raghunathan, Kalyani Mahrt, Kristi Food prices and the wages of the poor: A low-cost, high-value approach to high-frequency food security monitoring |
| title | Food prices and the wages of the poor: A low-cost, high-value approach to high-frequency food security monitoring |
| title_full | Food prices and the wages of the poor: A low-cost, high-value approach to high-frequency food security monitoring |
| title_fullStr | Food prices and the wages of the poor: A low-cost, high-value approach to high-frequency food security monitoring |
| title_full_unstemmed | Food prices and the wages of the poor: A low-cost, high-value approach to high-frequency food security monitoring |
| title_short | Food prices and the wages of the poor: A low-cost, high-value approach to high-frequency food security monitoring |
| title_sort | food prices and the wages of the poor a low cost high value approach to high frequency food security monitoring |
| topic | food prices crises food security nutrition wages diets monitoring inflation household income early warning systems |
| url | https://hdl.handle.net/10568/129751 |
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