Price Inflation Research Articles

Spatial dynamics of food inflation in India: insights from club convergence analysis

Spatial dynamics of food inflation in India: insights from club convergence analysis

Real Estate Inflation and Housing Finance in India : Mapping the Correlation between Raising Property Prices & Increasing Home Loans among Indian Cities

Focusing specifically on India — a country that has recently faced recessions partially due to housing bubbles, like many other nations around the world — this research explores in depth how development of real estate linked financing sector have fuelled mortgage led asset price inflation across different cities (both metros & Tier II/III) over decades. Drawing upon a variety of market statistics, policy and economic indicators, the research identifies strong relationships between housing loan availability — by way of loosening mortgage regulations — and property price growth. The study shows that metropolitan cities have witnessed growth in housing loans at a CAGR of 10-12% over last decade (2010–2020) resulting into similar annual price appreciation for real estate standing between 010-15%. Tier II and III cities alternatively, exhibited slower but more stable growth trends in property prices of 6-8% driven by government push & infrastructure developments. The research emphasizes how this relationship has been altered by a number of variables, including as urbanization, demographic changes, government housing programs, and regulatory reforms like RERA and GST. The results imply that although housing financing has played a significant part in promoting the expansion of the real estate market, the influence varies greatly depending on local market dynamics, infrastructural development, and the state of the local economy.

Geopolitical Risk and Food Price Inflation: A GVAR Analysis of BRICS and the G7

ABSTRACT We investigate the influence of geopolitical risk on domestic food prices in 12 economies (BRICS and the G7) using a global vector autoregressive (GVAR) approach from 2003M1 to 2022M9. The results show that geopolitical risk shocks cause increases in international prices (oil, agricultural, and general commodity prices). We found that these shocks also provoke fluctuations in domestic food prices. The variance decomposition indicated that international prices and geopolitical risk contribute to the formation of domestic food prices. Finally, the estimates suggest relevant differences between the formation of domestic food prices in BRICS and G7 countries.

Unveiling Extreme Dependencies between Oil Price Shocks and Inflation in Tunisia: Insights from a Copula Approach

We follow a non-linear dynamic correlation approach using a combination of a DCC-GARCH model and a copula model to capture the dependence between oil price changes and inflation in Tunisia. The case of Tunisia is particularly instructive since after having been an exporter and a major producer, it became a net oil importer in the 2000s. The study, based on monthly data spanning decades, selects a Gumbel copula and shows that beyond weak average dependencies, there is a strong correlation between extreme values, suggesting that inflation in Tunisia is more sensitive to extreme (positive) variations in oil prices than to average variations. The implications of these empirical results for economic policy are crucial for the Tunisian economy.Copyright© 2024 The Author(s). This article is distributed under the terms of the license CC-BY 4.0., which permits any further distribution in any medium, provided the original work is properly cited.

Welfare implications of rising imported food costs in the Caribbean

Vulnerability to external shocks such as supply shortages, price increases, disasters and political discord has severe implications for Caribbean food and nutrition security and the scale of economic losses. There is a need to understand how food price shocks impact Caribbean consumers, who are particularly vulnerable due to their heavy reliance on imported food. This study assessed the welfare impacts of rising imported food prices on Caribbean consumers using the linear approximated almost ideal demand system (LA-AIDS) model and compensating variation. The welfare implications of rising prices were assessed using three price shocks in: 2006–2008, 2010–2011, and 2020–2021. Hicksian price elasticities revealed that most imported food categories in the Caribbean region have inelastic demand, except for imported meat and seafood which was found to be elastic. Imported cereals and staples and fats and oils were the least responsive to price changes, while imported meat and seafood was highly responsive. The results of the compensating variation revealed that there were significant welfare losses in 2006–2008 and 2010–2011, when food prices drastically increased, as well as during the first year of the COVID-19 pandemic (2020–2021). Between 2006-2008 and 2010–2011, welfare losses were approximately US$1.54 billion and US$692.52 million, respectively, while food price inflation during the first year of the COVID-19 pandemic resulted in losses estimated at US$1.09 billion. This research highlights the need for regional policies to minimize welfare losses from rising food prices, including social safety nets for vulnerable households and investments in domestic agriculture and supply chain resilience.

An Econometric Analysis of Inflation, Exchange Rate, and Interest Rate on Stock Market Performance in South Africa

The stock market is crucial for resource production, distribution, and mobilization because it provides listed firms with long-term funding. Despite the extensive research on the relationship between inflation and exchange rates, the influence of interest rates on stock market performance has received limited investigation. The goal of this study is to address this gap by examining extensive South African data spanning from the first quarter of 2010 to the fourth quarter of 2022. The study constructs a sample space of 48 quarters, utilizing the JSE All Share Price Index as a substitute for measuring stock market performance. Furthermore, it incorporates additional macroeconomic data from reputable sources like the Federal Reserve Bank of St. Louis and the South African Reserve Bank. We employ the auto-regressive distributed lag (ARDL) model to examine the relationship between the stock prices of the Johannesburg Stock Exchange (JSE) and various variables, including inflation, interest rates, and exchange rates. The unit root test results indicate that the exchange rate integrates at order zero (I(0)), while the share price index, inflation, and interest rate integrate at order one (I(1)). The model explains roughly 96.5% of the variability in the dependent variable. According to the findings, short-term interest rates have a significant and negative impact on the Johannesburg stock market’s performance. However, the study does not demonstrate the significant effects of exchange rates and inflation. Furthermore, the Granger causality test has proven that the independent factors have no ongoing impact on the dependent variable. Without establishing the generalizability of the findings outside these boundaries, the study limits its conclusions to South Africa and the studied period. Different methods, as the quantile autoregressive distributed lag (QARDL) or the non-linear autoregressive distributed lag (NARDL) methodology, could be used in future studies to look into these relationships. These studies could also look at other factors that affect stock market performance. These insights may help policymakers adopt the most effective monetary or fiscal policies and support investors in making well-informed decisions to diversify their portfolios and minimize risks.

Climate pattern effects on global economic conditions

This study investigates how El Niño–Southern Oscillation (ENSO) climate patterns affect global economic conditions. Prior research suggests that ENSO phases, particularly El Niño, influence economic outcomes, but with limited consensus on their broader macroeconomic impacts. Using a novel monthly dataset from 20 economies, covering 80% of global output from 1999 to 2022, we employ a global augmented vector autoregression with local projections (GAVARLP) model. The empirical findings suggest that El Niño boosts output with minimal inflationary effects, reducing global economic policy uncertainty, while La Niña raises food inflation, which can amplify aggregate inflation as a “second-round” effect, amplifying uncertainty. These findings shed light on the transmission channels of climate shocks and highlight the significant role of ENSO in shaping global economic conditions, emphasizing why climate shocks should be a concern for policy markers.

Gold Price Inflation and Its Implications for Financial Markets: Strategies for Mitigation

Abstract: Gold prices are among the most important indicators in the global financial market. The international gold price has continued to rise in recent years, repeatedly setting new records, accompanied by a boom in gold consumption and investment. The rapid rise in gold prices is due to a combination of factors. Supply and demand, economic conditions, and geopolitical events can lead to price fluctuations. Among them, economic conditions depend on monetary policy, inflation expectations, and market volatility, which may affect the trend of gold prices. The rise in gold prices has exacerbated market volatility and put higher demands on risk management for financial institutions. At the same time, the rise in gold prices has also affected the entire financial industry and changed traditional asset allocation strategies. This article examines the influence of increasing gold prices on the financial market and proposes potential preventive measures or solutions through a survey of literatures, theoretical analysis and logical reasoning. At the same time, this can help financial traders plan their funds reasonably, reduce the impact of inflation and currency devaluation, and better cope with changes in international trade and exchange rates, thus allowing the financial market to operate better.

Taste and Habit of Food and Consumer Behavior in the USA in the Early Years of Covid-19 Pandemic

The USA, a highly advanced economy in the world, had experienced increase in household demand for specific food items (restaurant and cafeteria supply, in particular) in the early years of Cobid-19 pandemic. People of America depended largely on the tastes and habits of food items in their household consumption. Even with increasing prices the demand for restaurant foods showed increasing trends. This means that the consumption of food away from home (FAFH) increased and food at home (FAH) fell in demand in 2020 and 2021 (Covid- 19 pandemic). Fundamental law of demand in economics (Ceteris Paribus) for normal goods demand will fall if price of the same increases and vice versa. In the present study, rise in prices of normal goods (restaurant and cafeteria foods) had also shown increase in their demand. This perhaps shows paradoxical to the law of demand in economic theory.  Methodology: This is a study based on secondary sources of information including research works, official publications and those from academic institutions. Analysis of data generated and narratives have been used to find the contemporary food economy of the USA. The demand for food (both FAFH and FAH) has been given importance in the situation of food inflation in the USA in early years of Covid- 19 pandemic. Finally, the equilibrium of the household food consumption is shown geometrically (Fig-1).  Findings and Results: It is found from the study that while the price of food away from home (FAFH) was increasing, the demand for those was also increasing in 2020 and 2021 in the USA. Food being a ‘normal good’ might have shown a fall in demand when price was increasing. This is perhaps, paradoxical in view of the law of demand in economic theory.

Trends in household food insecurity from the Canadian Community Health Survey, 2017 to 2022.

Income-related food insecurity is an important determinant of health. This study aimed to provide an update on the food security status of Canadian households using the most recent available data from a health-oriented national-level survey. This study also examined trends in food insecurity since 2017, and how these have tracked with changes in price inflation. Data on household food security status in the 10 Canadian provinces came from five annual cycles of the population-representative cross-sectional Canadian Community Health Survey (CCHS): 2017, 2018, 2020 (September to December), 2021, and 2022. The Household Food Security Survey Module was used to categorize household food security status during the previous 12 months as food secure or marginally, moderately, or severely insecure. Before 2019, approximately 1 in 10 households had experienced some level of food insecurity in the previous 12 months (9.6% in 2017 and 11.6% in 2018). Household food insecurity prevalence was slightly lower and stable during the COVID-19 pandemic years (8.5% in fall 2020 and 9.1% in 2021) and increased to 15.6% in 2022. Levels of household food insecurity generally tracked with changes in consumer price inflation. Compared with 2021, there were notable increases in levels of moderate and severe food insecurity in 2022 among one-parent households with children, renters, and those reliant on government financial assistance. The prevalence of household food insecurity in the CCHS was relatively stable from 2017 to 2021, increased in 2022, and generally tracked with changes in price inflation. Monitoring levels of household food insecurity will continue to be important as price inflation eases but the cost of living remains high.

War in foreign lands, hunger at home

The war between Russia and Ukraine pitted two major agricultural countries and threatened the African continent with food insecurity and hunger. The war came at a time when the world was emerging from another global challenge of the COVID-19 pandemic and its attendant effects of distorted food prices and disruptions of the food supply chain. Informed by the analysis of the literature available on the Web of Science, Scopus, Google Scholar databases and grey literature from United Nations (UN) agencies, this study explores the challenges that emanated from the global problem of conflict and its implications on food security and the fight against hunger in Africa. The study found that the Russo-Ukrainian war exposed the lack of progress in Africa towards the fight to eliminate hunger. The consequences of the war have been aggravated by this lack of progress towards achieving zero hunger in many African countries. The war disrupted the global supply chain and threatened Africa with hunger as the continent experienced food shortages, food inflation and general commodity price volatility.

EU food price inflation amid global market turbulences during the COVID‐19 pandemic and the Russia–Ukraine War

AbstractSince the COVID‐19 pandemic and the Russia–Ukraine War, global food markets have been in turmoil. Agricultural input and energy prices doubled between 2020 and 2022, with immediate consequences on food accessibility. We examine the drivers of the EU food inflation patterns, and how trade integration shapes these dynamics. We find that food price inflation has been mainly driven by surges in agricultural production costs and, to a lesser extent, by global food price increases. Trade openness has not exacerbated the inflating dynamics during this period. We conclude with reflections on inflationary, production, and trade policies.

From food inflation to cash transfers and food subsidies: Assessing impacts on households' consumption and welfare in Togo

From food inflation to cash transfers and food subsidies: Assessing impacts on households' consumption and welfare in Togo

Food inflation and monetary policy in emerging economies

The rising inflationary pressure has been linked with supply-side disruptions and rising energy and food prices against the background of the COVID-19 pandemic and the Russia-Ukraine crisis. This paper investigates the role of monetary policy in stabilizing food inflation in emerging economies (India, China, Brazil, Russia, and South Africa). We also investigate the causal linkage between monetary policy and food inflation using frequency domain-based Granger causality and find strong feedback causal effects between food inflation and monetary policy changes. Our results are robust to different estimation methodologies, possible asymmetry, and alternative model specifications, which include climate change. While oil prices, world food prices, and exchange rates have heterogeneous effects on domestic food inflation, a contractionary monetary policy stance leads to a decline in domestic food inflation in all countries. Thus, we provide strong evidence that well-coordinated macroeconomic policies in emerging economies are essential for stabilizing food inflation.

Share Pledging and Corporate Misconduct

We investigate and find a significant and positive relation between share pledging by controlling shareholders and the likelihood of corporate misconduct. The results remain robust after classifying misconduct into accounting and non-accounting misconduct, and misconduct receiving severe and light penalties. Alleviation of financial constraints, inflation of stock prices, mitigation of margin calls, and expropriation under poor corporate governance are the main motives for corporate misconduct by firms with pledging controlling shareholders. The positive relation between share pledging and corporate misconduct propensity remains after accounting for endogeneity issues, political connections, intensified bank monitoring, and share repurchasers.

Revolutionizing food security: The transformative role of fungi in the 21st century

With increasing global population density and climate change, the sustainability of food production poses new challenges. These are factors such as food inflation, climate change, natural disasters, and diseases affecting crops among others. Consequently, fungi have evolved as a pillar of ecological agriculture in the twenty-first century. Some of the diverse applications of fungi include biological control, synthesis of antifungal compounds, symbiotic relationship with plants, and enhancement of soil structure. They also function as decomposers in ensuring nutrient availability in the soil, and as biostimulants to enhance plants’ growth, plant disease management and enhanced resistance to abiotic stressors such as water scarcity, and salinity and mitigate the impact of climate change. Furthermore, fungi play other important roles in food security, such as in the processing of various foods including cheese, bread, fermented products and other sources of protein, vitamins, and dietary fiber, while foods of fungi origin prevent lifestyle diseases. New approaches in fungal biotechnology present the hope of eliminating hunger and malnutrition through food production, preservation, and packaging among others. Although, challenges persist in the management of pathogenic fungi in agriculture, however, it is important to leverage the beneficial role of fungi and encourage further exploration of its transformative potential towards a secured global food security.

The Effect of Economic Growth, Imports and Exports on Food Inflation in ASEAN Countries: Case Study of Timor Leste, Laos, Cambodia, and Myanmar

The Effect of Economic Growth, Imports and Exports on Food Inflation in ASEAN Countries: Case Study of Timor Leste, Laos, Cambodia, and Myanmar

Comparing the Effects of Information Globalization on Agricultural Producer Prices in Developing and Developed Countries

Existing studies claim that the Internet of Things (IoTs) raises agricultural producer prices while others claim the contrary. Meanwhile, no studies have been conducted to investigate the impact of IoTs at the macro level, as represented by information globalization. The main objective of this study is to determine the impact of information globalization on agricultural producer prices in developing and developed countries. This study used time series data from 1991 to 2020 and cross-section data from 66 developing and 26 developed countries. The data was analyzed using two-stage least squares. The first stage of analysis shows that pesticides and farm machinery increase agricultural production in developing and developed countries, while employment in agriculture, forestry, and fishing has the opposite effect. Meanwhile, nutrient nitrogen, manure, and irrigation have differing effects on agricultural production in the two areas. The second stage of analysis shows that agricultural producer prices in developing and developed countries will rise when agricultural production, agricultural import, and human capital increase. Agricultural value-added, food consumer price inflation and population growth have varying impacts on agricultural producer prices. Meanwhile, the main variable investigated in this study, information globalization, has been proven to increase agricultural producer prices in both developing and developed countries.

Nutritional quality and diversity in Ghana’s school feeding programme: a mixed-methods exploration through caterer interviews in the Greater Accra Region

BackgroundThe Ghana School Feeding Programme (GSFP) provides public primary school pupils with a free daily meal. Each meal is expected to follow set menus, providing 30% of children’s’ (6-12 years) energy requirements. This study assessed the nutritional quality and diversity of planned and provided GSFP meals, engaging school caterers to identify how meal quality in the Greater Accra Region could be enhanced.MethodsA cross-sectional mixed methods study design was used. Multistage sampling was used to select 129 schools implementing the GSFP in six districts of the Greater Accra Region. GSFP district menus were collected as well as a one-week school caterer recall of provided school meals. The meal served on the day of data collection was recorded and photographed. Nutritional quality was evaluated based on nutrient profiling methods: energy density (low<125kcal/100g; medium 125-225kcal/100g; high>225kcal/100g) and nutrient density (low<5%; medium 5-10%; high>10%). Meal diversity was assessed by a simple count composed of 5 food groups: cereals, pulses/nuts/seeds, animal-source, vegetables and fruits. Caterers’ views on programme facilitators and barriers were also explored.ResultsPlanned menus included 14-20 weekly options, composed of eight minimally processed traditional dishes. All meals, except white rice, had a high nutrient density/100g. Energy density was varied (low, n=2; medium, n=2; high, n=4). Meals included only 2/5 or 3/5 food groups, mainly starchy staples, pulses/nuts/seeds, and sometimes vegetables. Fruit was never reported. About half of caterers (51.1%) reported deviating from the planned menus: 11.7% served alternative meals, with some including animal-sourced food (17.0%), and 39.4% repeated meals provided during the week, often based on starchy staples, influencing overall nutritional quality. Most caterers reported food item cost and lack of food purchase guidelines as barriers to providing school meals, while food safety training and guidelines for food preparation were facilitators.ConclusionsWhile school meals are composed of minimally processed, nutrient dense, local foods, there are notable gaps in meal diversity and compliance, as reflected in provided meals. Caterer compliance to planned menus varied greatly, reflecting recent food price inflation. Upwardly adjusting the current meal allocation of 1.2 cedis (0.22USD) per child per day could enhance access to more affordable, nutritious and diverse foods in school meals.

RELATIONSHIP BETWEEN ENERGY AND FOOD PRICES IN THE EURO AREA

Over the past five years, global economic developments have been accompanied by a number of challenges. After a period of economic development, the global economy is facing a significant challenge caused by the COVID-19 crisis. There have been factory closures, border closures and supply chain disruptions. All this is reflected in the EU and the euro area. This was followed by a period of recovery and accelerating inflation. The war on the territory of Ukraine is also having a significant impact on inflationary processes. This further jeopardises the supply of energy resources and their prices begin to rise at a very high rate. The shock of rising energy prices has also been reflected in sharp increases in food prices. In the euro area, there have been periods when food prices have risen by more than 17% on an annual basis and energy products by almost 60% in some months. All these developments highlight the need to examine the links between energy and food prices. This is necessary in order to be able to take quick decisions in the event of new volatility in energy prices. The aim of the study is to establish a causal relationship between the dynamics of energy and food prices and the time lag over which food prices react to increases in energy prices. A correlation analysis is carried out and a causal relationship between the two indicators is established by regression analysis at different time lags. The hypothesis tested is that, over the last five years, there has been a strong month-to-month correlation between energy prices and food prices with a lag of six months. For the purpose of regression analysis and hypothesis testing, monthly data for food inflation and inflation for the group Electricity, gas and other fuels have been used. The data are taken from the structure of the Harmonised Index of Consumer Prices published by Eurostat. The detailed regression analysis shows that there is a statistically significant linear relationship between the price indices of the two product groups with a lag of six months. The Granger causality test confirms the results of the dynamic, correlation and regression analysis. The results of the test show not only the existence of a causal relationship, but also the ability of energy price changes to predict food price dynamics. All this leads to the conclusion that in periods of significant changes in energy prices, food prices can be expected to follow similar dynamics within six months. This relationship could be used both for forecasting and for taking specific economic measures.