Development Digest: Policy Responses to Food Price Volatility
How will governments respond to the next food price crisis? What types of information do governments need in order to make smart policy decisions?
World Food Prize Laureate Per Pinstrup-Andersen recently led and completed a research project (a collaboration between the United Nations University World Institute for Development Economics Research, Cornell University, and the University of Copenhagen) that addressed these high-level questions. He shared project findings on February 2 at the Agrilinks Special Event, Policy Responses to Food Price Volatility.
Using the 2007–2008 food price crisis as a “natural experiment,” Pinstrup-Andersen and colleagues sought to explain government responses to price fluctuations and to gain an overall better understanding of “the political economy of agricultural policy-making.”
In-depth case studies of 14 different countries that were highly affected by the food price crisis provided a global perspective. Pinstrup-Andersen commented on some of the key political economy takeaways from the research project and followed this with lessons for policy assistance and overall recommendations. Some recommendations to governments, given increasing market instability, include:
- Seek high levels of price transmission in markets, coupled with fewer trade restrictions.
- Improve the management of staple cereal crop stocks.
- Better facilitate public-private partnerships and engender trust between sectors.
Danielle Resnick of the International Food Policy Research Institute (IFPRI) then expanded upon Pinstrup-Andersen’s research by providing a broader theoretical framework of drivers of agriculture and nutrition policy change. Her research with IFPRI and the Food Security Policy Innovation Lab revolved around a case study comparison of food security policy change in low- and middle-income countries, giving special attention to the conditions under which macro-level policy change emerged. She illustrated a brief example of Ghana’s fertilizer subsidy program and highlighted the key conditions that allowed policy change to occur by using the “Kaleidoscope Model,” developed by researchers at the Innovation Lab. This model is intended to apply broadly to policy change scenarios going forward.
If you missed this presentation, don’t fear! You can watch the webinar recording here, or peruse the presenters' project resources. For high-level takeaways, watch the presenters and UNU-WIDER Director Finn Tarp discuss their findings in the below video.