Rice price inflation and its impact on poverty and livelihood: Insights from Bangladesh

Author: Taznoore S. Khanam *, Humnath Bhandari and Samarendu Mohanty
Received 2 January 2015, accepted 18 March 2015.
Abstract

Rice is the major staple food in Bangladesh, contributing 71% of total calorie supply, 58% of total protein intake, and 15% of rural household income. More than half of Bangladeshi households are net buyers of rice. Poor households spend 40% of their food expenditure on rice. By reducing real income and purchasing power, a rice price inflation worsens food insecurity and, in turn, poverty for millions of Bangladeshi households. Rapid rice price inflation in recent years is thus a serious concern. The Green Revolution led continuous growth in rice yield kept rice prices low. Low rice prices reduced poverty through better food security, higher real income, and improved livelihoods. Rice prices have, however, spiked significantly in 2008 and again in 2010 and 2013. This study investigates the causes of rice price inflation and its effects on rural livelihood and examines poor households’ coping mechanisms to higher rice price. We found that the 2008 food price hike pushed an additional 9 million Bangladeshis below the poverty line. Higher rice price increased poverty incidence and overall inflation in Bangladesh. Several elements on the demand and supply side and some other factors contributed to the rapid rise in rice prices in Bangladesh. Poor households adopted multiple food-based and non-food-based consumption- smoothing and income-smoothing strategies to cope with the impacts of higher rice prices. The consequences of some of these coping strategies are long term and irreversible. We conclude that rice price will remain high and will continue to rise in the future with adverse impact on food security and poverty reduction efforts. We discuss several technological and policy solutions to further cap the sharp hike in rice price, to supply rice at an affordable price to the poor, and to minimize the impact of future rice price hike on millions of poor Bangladeshi households.

Journal: Food, Agriculture and Environment (JFAE)
Online ISSN: 1459-0263Year: 2015, Vol. 13, Issue 2, pages 107-117Publisher: WFL.


Article Purchasing
 
Impact Factor


If you like to purchase this specific document  such as article, review or this journal issue, contact us.

Specify the title of the article or review, issue, number, volume and date of the publication.

Software and compilation, Science & Technology,  all rights reserved.

Your use of this website details or service is governed by terms of use.

Authors are invited to check from time to time news or information, read more>>>


Note to Users

The requested document is freely available only to subscribers/registered users with an online subscription to the Journal of Food, Agriculture & Environment. If you have set up a personal subscription to this title please enter your user name and password. All abstracts are available for free.