Pakistan Institute of Development Economics



Impact of Global Food Price Escalation on Poverty in South AsianCountries

The objective of this paper is to examine the impact of globalfood price escalation on poverty in South Asian countries since 1990 to2011. Panel data procedure has been applied for empirical analysis.Panel unit root tests have been utilised before the application of panelco-integration. Poverty is measured through revealed behaviour approachwhich is considered better than other approaches, as it is based on theactual consumption made by the households. The present study uses actualaverage household consumption to measure poverty. Empirical resultsreveal that global food price escalation and per capita incomepositively and significantly affect average household consumption, whichis the clear indication of poverty decline. International oil prices andinterest rate significantly but negatively affect the average householdconsumption in South Asian countries. Findings of this study will behelpful for formulating effective public policies for poverty reductionin the era of trade liberalisation. JEL Classification: E31, F410, I32Keywords: Food Price Escalation, Poverty, Oil Prices, Per Capita Income,South Asia

Muhammad Abdullah,

Rukhsana Kalim