Rising Food Prices and Household Welfare : Evidence from Brazil in 2008

Food price inflation in Brazil in the twelve months to June 2008 was 18 percent, while overall inflation was seven percent. Using spatially disaggregated monthly data on consumer prices and two different household surveys, we estimate the welfare c...

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Bibliographic Details
Main Authors:	Ferreira, Francisco H.G., Fruttero, Anna, Leite, Phillippe, Lucchetti, Leonardo
Format:	Policy Research Working Paper
Language:	English
Published:	2012
Subjects:	AGRICULTURAL ACTIVITIES AGRICULTURAL ACTIVITY AGRICULTURAL COMMODITIES AGRICULTURAL LABOUR AGRICULTURAL OUTPUT AGRICULTURAL PRICE AGRICULTURAL PRICES AGRICULTURAL PRODUCTION AGRICULTURAL SECTORS AGRICULTURAL WAGES AGRICULTURAL WORKERS AGRICULTURAL WORKFORCE AGRICULTURE ANIMAL HUSBANDRY AVERAGE PRICE BASIC FOODSTUFFS BEEF CA CARIBBEAN REGION CASH TRANSFER PROGRAM CASH TRANSFER PROGRAMS CASH TRANSFERS CEREALS COMMODITY PRICE COMMODITY PRICES CONDIMENTS CONSUMER PRICE CONSUMER PRICE INDEX CONSUMER PRICES CONSUMER SURPLUS CONSUMPTION EXPENDITURE COST OF LIVING COUNTERFACTUAL DAIRY DECOMPOSABLE POVERTY DOMESTIC PRICES ECONOMIC GROWTH EGGS EXTREME POVERTY FACTOR PRICES FAMILY FARMS FARM HOUSEHOLDS FARM INCOME FARM INCOMES FARM LABOR FARM PRODUCTION FARM WORKERS FARM-GATE FARMERS FATS FEEDS FLOUR FOOD BUYERS FOOD COMMODITIES FOOD CONSUMPTION FOOD CONSUMPTION EXPENDITURES FOOD EXPENDITURE FOOD ITEMS FOOD MARKETS FOOD PRICE FOOD PRICE INFLATION FOOD PRICES FOOD PRICING FOOD PRODUCER FOOD PRODUCTION FOOD SALES FOODS FRUIT GRAINS HOUSEHOLD BUDGET HOUSEHOLD COMPOSITION HOUSEHOLD CONSUMPTION HOUSEHOLD INCOME HOUSEHOLD SURVEY HOUSEHOLD SURVEYS HOUSEHOLD WELFARE HOUSING IMPACT ON POVERTY INCOME INCOME DISTRIBUTION INCOME EFFECTS INCOME GAINS INCOME GROWTH INCOME INEQUALITY INEQUALITY LABOR MARKET LABOR MARKETS LEGUMES MAIZE MARKET POWER MEAT METROPOLITAN REGION METROPOLITAN REGIONS MILK NEW POOR OILS AND FATS PASTA PER CAPITA CONSUMPTION POLITICAL ECONOMY POVERTY DYNAMICS POVERTY GAP POVERTY INCIDENCE POVERTY INCREASE POVERTY INDICES POVERTY LINE POVERTY LINES POVERTY MEASURES POVERTY POVERTY POVERTY RATES POVERTY REDUCTION PRICE CHANGE PRICE CHANGES PRICE EFFECT PRICE INCREASE PRICE INCREASES PRICE INDEX PRICE INFLATION PRICE VARIATION PRICE VOLATILITY PRICING REFORMS PURCHASING REGIONAL DIFFERENCES REGIONAL PRICE REGIONAL VARIATION RURAL RURAL AREAS RURAL POOR RURAL POPULATION SAVINGS SHARECROPPERS SOCIAL ASSISTANCE SOCIAL PROGRAMS SOCIAL PROTECTION STARCHES SUBSISTENCE SUBSTITUTE SUBSTITUTION SUGAR SUGARS SUPPLY CURVE SURPLUS TARGETING TRANSFER AMOUNTS TRANSFER PROGRAMS TUBERS VEGETABLES VOLATILITY WELFARE MEASURE WHEAT
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20110928105536 http://hdl.handle.net/10986/3581

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Summary:	Food price inflation in Brazil in the twelve months to June 2008 was 18 percent, while overall inflation was seven percent. Using spatially disaggregated monthly data on consumer prices and two different household surveys, we estimate the welfare consequences of these food price increases, and their distribution across households. Because Brazil is a large food producer, with a predominantly wage-earning agricultural labor force, our estimates include general equilibrium effects on market and transfer incomes, as well as the standard estimates of changes in consumer surplus. While the expenditure (or consumer surplus) effects were large, negative and markedly regressive everywhere, the market income effect was positive and progressive, particularly in rural areas. Because of this effect on the rural poor, and of the partial protection afforded by increases in two large social assistance benefits, the overall impact of higher food prices in Brazil was U-shaped, with middle-income groups suffering larger proportional losses than the very poor. Nevertheless, since Brazil is 80 percent urban, higher food prices still led to a greater incidence and depth of poverty at the national level.

Rising Food Prices and Household Welfare : Evidence from Brazil in 2008

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