Attenuating through Aid the Vulnerability to Price Shocks

GUILLAUMONT Patrick (), Sylviane Guillaumont Jeanneney (), CHAUVET Lisa (), JACQUET Pierre and SAVOYE Bertrand
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GUILLAUMONT Patrick: Centre d'Etudes et de Recherches sur le Développement International
CHAUVET Lisa: DIAL
JACQUET Pierre: Agence Française de Développement
SAVOYE Bertrand: Agence Française de Développement

No 200325, Working Papers from CERDI

Abstract: The purpose of this paper is to examine what kind of global measures may be efficiently implemented to help the developing countries to face price shocks, avoiding the past failures, which needs to take into account the long term trend of the markets. Firstly, we recall the nature of the vulnerability to price shocks: this legitimates to make the dampening of these shocks a reasonable goal for the development cooperation policy. Then, we consider the rationality of some international schemes of insurance or of guarantee which could be implemented through international assistance for countries facing price shocks: this assistance should be provided on a macroeconomic level, in particular through debt management, and on a microeconomic level, for instance through an insurance for the producers. The general principle underlying our proposals is that international assistance can enable developing countries to face price shocks, while taking into account the market signals, by offering a guarantee to these countries provided they respect some management rules.

Date: 2003

Published in , 2003, pages

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Persistent link: http://EconPapers.repec.org/RePEc:cdi:wpaper:448

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