International Conference on Eurasian Economies
29-31 August 2016 – Kaposvár, HUNGARY
Paper detail
Paper ID : 1693
Status : Paper published
Language : Turkish
Topic : Sectoral Analyses
Presenter: Dr. Duygu Serin Oktay
Session : 1E Büyüme I
The Impact of Energy Prices on World Food Prices: A Bounds Testing Approach
Enerji Fiyatlarının Dünya Gıda Fiyatları Üzerine Etkisi: Bir Sınır Testi Yaklaşımı
- Prof. Dr. Neşe Algan (Çukurova University, Türkiye)
- Assoc. Prof. Dr. Erhan İşcan (Çukurova University, Türkiye)
- Dr. Duygu Serin Oktay (Çukurova University, Türkiye)
Abstract
Economic developments of the countries are highly interrelated with food prices due to food security. World food prices have dramatically changed in recent years. The rise of food prices have warned all governments because of socio-economic implications and stimulated extensive academic discussions. Increase of food prices is not surprising while energy prices increased during the same periods. Therefore, the energy prices can be seen as one of the determinant of food prices. Energy prices influence food price movements in many ways. Firstly, increasing energy prices result in a rise in input costs. Second, the increase in energy prices will increase the transport costs thus; changes of the energy prices directly affect production cost of food and consequently food prices. Therefore, detailed analysis is essential for understanding the nature of food prices. The aim of this study is to investigate the impact of energy prices on world food prices. Therefore, we investigate the long-run equilibrium relationship between world energy prices and world food prices using the ARDL approach to cointegration and error correction models. We establish the model by using the quarterly data of 2009Q1-2015Q4 period provided by IMF-IFS database. The empirical results imply that there is a long-term significant statistical relationship between world energy prices and world food prices. This study provides evidences to policy makers for sensible decision, and literature for further researches. These results suggest that policy makers should get under control the energy prices to stabilize the food prices to ensure the food security.
JEL codes: Q02, Q40, C22
Algan, Neşe, İşcan, Erhan, Serin Oktay, Duygu (2016). "The Impact of Energy Prices on World Food Prices: A Bounds Testing Approach" in Proceedings of International Conference of Eurasian Economies 2016, pp.794-800, Kaposvár, HUNGARY.
DOI: https://doi.org/10.36880/C07.01693
