Analysing food price trends in the context of Engel’s Law and the Prebisch-Singer hypothesis

John Baffes () and Xiaoli Etienne

Oxford Economic Papers, 2016, vol. 68, issue 3, 688-713

Abstract: Income growth in emerging economies has been often cited as a key driver of the past decade’s commodity price boom—the longest and broadest boom since World War II. This article shows that income has a negative and highly significant effect on real food commodity prices, a finding that is consistent with Engel’s law and Kindleberger’s thesis, the predecessors of the Prebisch-Singer hypothesis. The article also shows that in the long run, income influences real food prices mainly through the manufacturing price channel (the deflator), hence weakening the view that income growth exerts strong upwards pressure on food prices. Other (short-term) drivers of food prices include energy costs, inventories, and monetary conditions.

Date: 2016
References: Add references at CitEc
Citations: View citations in EconPapers (27)

Downloads: (external link)
http://hdl.handle.net/10.1093/oep/gpw011 (application/pdf)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:oup:oxecpp:v:68:y:2016:i:3:p:688-713.

Ordering information: This journal article can be ordered from
https://academic.oup.com/journals

Access Statistics for this article

Oxford Economic Papers is currently edited by James Forder and Francis J. Teal

More articles in Oxford Economic Papers from Oxford University Press Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK.
Bibliographic data for series maintained by Oxford University Press ().