Fluctuating staple prices and household poverty in India

Lindsay Shutes, Anand Ganesh-Kumar and Gerdien Meijerink

MPRA Paper from University Library of Munich, Germany

Abstract: The general perception is that high food prices in India have increased poverty and that trade reforms will further worsen poverty. We compare Foster-Greer-Thorbecke poverty measures for various scenarios of grain price swings with and without trade reform, using price and income effects for 32 representative households computed from a global economic model and a model of India's economy. The results suggest that a rise in the global rice price actually provides strong opportunities for poverty alleviation. Global trade reform reinforces this effect for all rural population groups. An increase in urban poverty partly offsets the overall poverty reduction. While India's trade measures effectively isolate sectors from swings in global markets, they also cause India to miss opportunities to benefit from buoyant global prices.

Keywords: Poverty; food prices; trade; CGE analysis; India; household analysis (search for similar items in EconPapers)
JEL-codes: C68 I32 O24 Q11 Q18 (search for similar items in EconPapers)
Date: 2012-08-31
New Economics Papers: this item is included in nep-agr and nep-cwa
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