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Wageningen University (2020)

PRICE VOLATILITY AND FOOD INSECURITY THE CASE OF ETHIOPIA

Tolina Addisu

Titre : PRICE VOLATILITY AND FOOD INSECURITY THE CASE OF ETHIOPIA

Auteur : Tolina Addisu

Université de soutenance : Wageningen University

Grade : MSc Thesis Environmental Economics and Natural Resources - Climate Studies - Environmental Economics and Natural Resource 2020

Résumé
Ethiopia is one of the food insecure countries in the world and it relies on food aid. To make up the shortage of cereal supplies, the country imported cereals (i.e. it is import dependent for three cereals : wheat, sorghum, and maize). As a result, Ethiopia is prone to price volatility in the international market. This study explores the domestic and international price situation of the three cereals (price trends and price volatilities) over the past eighteen years (2000-2018). In order to evaluate the state of price in domestic and international markets, this paper employed different measures. The trend in price is analysed using price index and regression analysis, while different volatility measures such as the coefficient of variation, corrected coefficient of variation and standard deviation in logarithmic price differences were used to measure the extent of price variability. In addition, the effectiveness of the country’s latest major food security programme has been reviewed. The results of the study show that in terms of food security, the most prominent change in Ethiopia’s cereal price is related to price volatility, not price increase. In fact, during the study period, the real domestic prices of two cereals (maize and sorghum) fell. Although the country has adopted a new food security programme (the productive safety net programme, PSNP), it has only shown limited success due to various reasons. PSNP is different from food aid because it links food security and development projects. Implementation issues (including targeting problem and transfer methods, i.e. only cash transfers or food transfers with/without cash component) and lack of synergy with complementary policies were factors that hindered the effectiveness of the food security programme. Furthermore, in terms of coverage, PSNP is mainly limited to four regions.

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Page publiée le 16 avril 2021