Global food price volatility and inflationary pressures among developing economies

Rexford Abaidoo () and Elvis Kwame Agyapong ()
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Rexford Abaidoo: University of Maryland Eastern Shore
Elvis Kwame Agyapong: Ghana Institute of Management and Public Administration

SN Business & Economics, 2023, vol. 3, issue 10, 1-21

Abstract: Abstract The study evaluates the impact of volatility in global commodity (food) prices on domestic inflationary conditions among economies in sub-Saharan Africa. Data for the analyses were compiled from relevant sources for 27 economies from the sub-region from 1996 to 2019. Empirical results from the two-step system generalized method of moments estimation technique suggest that volatility in the global price of traded commodities, such as corn, rice, and beef (staple food items among most economies in the sub-region), tends to worsen inflationary conditions among economies in the sub-region, all other things being equal. Further empirical estimates show that global inflationary conditions exacerbate domestic inflationary conditions, while appreciable global economic growth or performance helps to assuage the extent of inflationary conditions among economies in the sub-region. Additionally, further results suggest that institutional quality helps negate some of the adverse effects of volatility in the global price of rice and global inflationary conditions on domestic inflationary conditions among economies in the sub-region.

Keywords: Global commodity price volatility; Inflationary conditions; Institutional quality; Two-step system generalized method of moment (search for similar items in EconPapers)
JEL-codes: C33 C36 F F62 (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/s43546-023-00569-3

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