Preprint Article Version 1 Preserved in Portico This version is not peer-reviewed

The Macroeconomics of Food Insecurity and Food Price in Ethiopia: Bayesian VAR Analysis

Version 1 : Received: 18 January 2022 / Approved: 19 January 2022 / Online: 19 January 2022 (14:21:46 CET)

How to cite: Hassen, A. The Macroeconomics of Food Insecurity and Food Price in Ethiopia: Bayesian VAR Analysis. Preprints 2022, 2022010274 (doi: 10.20944/preprints202201.0274.v1). Hassen, A. The Macroeconomics of Food Insecurity and Food Price in Ethiopia: Bayesian VAR Analysis. Preprints 2022, 2022010274 (doi: 10.20944/preprints202201.0274.v1).

Abstract

The general objective of the study is to analyze food insecurity determinants mainly related to food price at macro level. The study used a time series data from the year 1988 quarter one to 2018 quarter four. Our empirical finding on the macroeconomic model show the short term consequence of food price change is positive with food security (negative with food insecurity). The long term consequence of food price change is, however, negative with food security (positive with food insecurity) at macro level. From the variance decomposition, it can be learned that the speed by which the undernourished people decrease in number in the short term because of the inflation happened is higher than the speed by which the number of undernourished people increase in the long run. At macro level, concern should be made to the supply side for food security improvement.

Keywords

Food Security; Food lnflation; Bayesian VAR

Subject

SOCIAL SCIENCES, Economics

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