Shocks to the international prices of agricultural commodities and the effects on welfare and poverty. A simulation of the ex ante long-run effects for Uruguay

Moncarz, Pedro E.; Barone, Sergio; Descalzi, Ricardo

doi:10.1016/j.inteco.2018.01.007

Cited by 13 publications

(13 citation statements)

References 16 publications

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“…One of the most common spillovers included in the literature is the changes in wages, which generate first-order effects on households' welfare through changes in their income. Examples including this channel are Porto (2006Porto ( , 2010, Borraz et al (2012) and Moncarz et al (2017Moncarz et al ( , 2018, all looking at some members of MERCOSUR. Porto (2006) studies the effect brought by the signing of MERCOSUR on Argentina, whereas Borraz et al (2012) are interested in Paraguay and Uruguay.…”

Section: Commodity Prices Welfare Inequality and Povertymentioning

confidence: 99%

“…The result is a decline in poverty, which could be attributed mostly to a large wage elasticity (up to 0.85) relative to the prices of agro-manufacture goods. Moncarz et al (2017Moncarz et al ( , 2018, more closely related to the current research, are interested in the effects of the increase in prices of agricultural commodities in Argentina and Uruguay. Their results show a reduction in welfare all over the entire income distribution, as well as an increase in poverty, but once the induced increase in government transfers is included, the results exhibit a less negative pattern.…”

Section: Commodity Prices Welfare Inequality and Povertymentioning

confidence: 99%

“…Similarly, Nicita et al (2014), whose model includes consumption, agricultural income and labor income effects, find that trade policies tend to be biased in favor of poor households because protection increases the agricultural prices of goods that are sold by African households, and this effect dominates the impacts on both expenditures and wages. A second set of spillovers considered in the literature are those on other goods that are not directly affected by the exogenous shocks, in this group we have the above-mentioned contributions of Porto (2006Porto ( , 2010, Borraz et al (2012), Moncarz et al (2017Moncarz et al ( , 2018, among others. As can be expected, including goods and services whose prices are indirectly affected tends to increase (reduce) the losses (gains) experienced by households, with the effects showing a bias against richer households.…”

Section: Commodity Prices Welfare Inequality and Povertymentioning

confidence: 99%

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Rising commodity prices and welfare in Brazil

Moncarz

Barone

2019

IJOEM

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Purpose Brazil, a large developing economy whose main exports consist of primary commodities, benefited greatly from the boom in commodity prices during the first decade of the current century. However, with a large share of its population with low and very low incomes, there is a potential for some adverse redistributive effects. The purpose of this paper is to address this issue by simulating the ex ante effects using a mixed endogenous–exogenous social accounting matrix (SAM) price model. Design/methodology/approach The methodology consists of two parts. First, using a mixed endogenous–exogenous SAM price model, the authors obtain the elasticities of domestic prices (goods, services and factors) in response to the increase in international prices of three types of commodities: agricultural, oil/gas and minerals. Second, the authors run micro-simulations at the household level on welfare effects, as well as on some distributive indices. Analysis at the regional level is also carried out. Findings Following increases in the international prices of primary commodities, the responses of internal prices (goods, services and factors) mean a welfare loss all over the entire distribution of household per capita expenditure; the least affected are those households at the low end and around the median of the distribution. However, the differences among households are not very important. Moreover, once we take into account government transfers and payments from social security, the magnitude of the effects reduces even further. Also, inequality indices and poverty rates show little responsiveness to the simulated shocks. Finally, poorer regions are the most likely to be affected, but also the distribution of effects across households shows differences between regions. Originality/value Economies with comparative advantages in the production of primary commodities can benefit at a macro-level from the increase in the international prices of such commodities. However, when a large part of the population spends a high proportion of its income on goods whose prices may be affected by the increase in commodity prices, there is a room for some undesirable effects from a redistributive standpoint. This study provides valuable results about such potential effects for Brazil, a large developing economy.

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Section: Commodity Prices Welfare Inequality and Povertymentioning

confidence: 99%

Section: Commodity Prices Welfare Inequality and Povertymentioning

confidence: 99%

Section: Commodity Prices Welfare Inequality and Povertymentioning

confidence: 99%

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Rising commodity prices and welfare in Brazil

Moncarz

Barone

2019

IJOEM

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“…Terms of trade shocks can raise poverty rates (e.g., Guillaumont and Puech, 2005;Nkurunziza et al 2017). Global food prices shocks have resulted in higher poverty rates in low-income countries (e.g., Ivanic and Martin, 2008), and increases in international prices of agricultural commodities have exerted substantial adverse effects on welfare, and significantly raised poverty (e.g., Moncarz et al, 2018). According to Rewilak (2018), currency crises are the most harmful types of crises to the poor.…”

Section: Introductionmentioning

confidence: 99%

Export Product Diversification, Poverty and Tax Revenue in Developing Countries

Gnangnon

2020

Preprint

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The current paper has examined the effect of both export product diversification and poverty on non-resource tax revenue in developing countries. The analysis has used an unbalanced panel dataset of 111 countries over the period 1980-2014. Based on the Blundell and Bond two-step system Generalized Methods of Moments technique, the empirical analysis has shown interesting findings. Export product concentration and poverty influence negatively non-resource tax revenue over the full sample, but this effect varies across countries in the sample. Furthermore, the effect of export product diversification on non-resource tax revenue performance depends on the level of poverty. It appears that export product diversification influences positively non-resource tax revenue performance in countries that experience lower poverty rates. From a policy perspective, these findings show that policies in favour of diversifying export product baskets and reducing poverty would contribute to enhancing non-resource tax revenue performance in developing countries.

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“…These studies include for exampleAlimi and Aflouk (2017);Barrot et al (2018); Dabla-Norris and Gündüz (2014);Ivanic and Martin (2008);Loayza and Raddatz (2007);Moncarz et al (2018);Raddatz (2007); andRewilak (2018). See alsoGnangnon (2020) for a literature review on the effect of macroeconomic volatility on poverty, including through external shocks.Preprints (www.preprints.org) | NOT PEER-REVIEWED | Posted: 29 January 2021 doi:10.20944/preprints202101.0602.v1…”

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confidence: 99%

Economic Complexity and Poverty in Developing Countries

Gnangnon¹

2021

Preprint

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This paper has examined the effect of economic complexity on poverty in developing countries. The analysis has used a sample of 84 countries over the period 1980-2017. Results indicate that greater economic complexity results in lower poverty headcount rates. This is particularly the case for countries that enjoy higher economic growth rates, lower levels of income inequality and lower degrees of economic growth volatility, including due to lower sizes of export demand and financial flows shocks. These findings have important policy implications for developing countries that are exploring ways and means to recover from the current COVID-19 pandemic crisis, and prepare for future crises.

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Shocks to the international prices of agricultural commodities and the effects on welfare and poverty. A simulation of the ex ante long-run effects for Uruguay

Cited by 13 publications

References 16 publications

Rising commodity prices and welfare in Brazil

Rising commodity prices and welfare in Brazil

Export Product Diversification, Poverty and Tax Revenue in Developing Countries

Economic Complexity and Poverty in Developing Countries

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