Food Import Dependency and National Food Security: A Price Transmission Analysis for the Wheat Sector
Agricultural trade liberalization and protecting domestic markets encompass conflicting policy goals. Even though after the food crisis in 2008, national governments of food-deficit nations aimed at reducing food supply dependency on external markets, no research has assessed the impacts of food imp...
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doaj-00ed89cb8c7444bc95995c7748c4bb392021-08-26T13:44:52ZengMDPI AGFoods2304-81582021-07-01101715171510.3390/foods10081715Food Import Dependency and National Food Security: A Price Transmission Analysis for the Wheat SectorPengfei Luo0Tetsuji Tanaka1Department of Economics, Setsunan University, 17-8 Ikedanakamachi, Neyagawa, Osaka 572-8508, JapanDepartment of Economics, Setsunan University, 17-8 Ikedanakamachi, Neyagawa, Osaka 572-8508, JapanAgricultural trade liberalization and protecting domestic markets encompass conflicting policy goals. Even though after the food crisis in 2008, national governments of food-deficit nations aimed at reducing food supply dependency on external markets, no research has assessed the impacts of food import reliance on price or price volatility transmissions to local markets. We constructed a dynamic conditional correlation (DCC)–generalized autoregressive conditional heteroscedasticity (GARCH) model to examine whether wheat import dependency could make a country vulnerable to overseas shocks by analyzing the inter-relationships between the international wheat price and retail wheat flour prices in 10 net importing countries over the sample period from January 2005 to December 2019. It was found that retail price volatility in each region was positively correlated with international price volatility for most of the period concerned. We also discovered that external dependency could significantly protect the domestic market from the global one, implying that lowering wheat dependency on foreign markets improves “stability” and “availability” of food security without sacrificing “utilization”, but it may aggravate “access”.https://www.mdpi.com/2304-8158/10/8/1715import dependencywheatprice volatility transmissionGARCHDCC |
collection |
DOAJ |
language |
English |
format |
Article |
sources |
DOAJ |
author |
Pengfei Luo Tetsuji Tanaka |
spellingShingle |
Pengfei Luo Tetsuji Tanaka Food Import Dependency and National Food Security: A Price Transmission Analysis for the Wheat Sector Foods import dependency wheat price volatility transmission GARCH DCC |
author_facet |
Pengfei Luo Tetsuji Tanaka |
author_sort |
Pengfei Luo |
title |
Food Import Dependency and National Food Security: A Price Transmission Analysis for the Wheat Sector |
title_short |
Food Import Dependency and National Food Security: A Price Transmission Analysis for the Wheat Sector |
title_full |
Food Import Dependency and National Food Security: A Price Transmission Analysis for the Wheat Sector |
title_fullStr |
Food Import Dependency and National Food Security: A Price Transmission Analysis for the Wheat Sector |
title_full_unstemmed |
Food Import Dependency and National Food Security: A Price Transmission Analysis for the Wheat Sector |
title_sort |
food import dependency and national food security: a price transmission analysis for the wheat sector |
publisher |
MDPI AG |
series |
Foods |
issn |
2304-8158 |
publishDate |
2021-07-01 |
description |
Agricultural trade liberalization and protecting domestic markets encompass conflicting policy goals. Even though after the food crisis in 2008, national governments of food-deficit nations aimed at reducing food supply dependency on external markets, no research has assessed the impacts of food import reliance on price or price volatility transmissions to local markets. We constructed a dynamic conditional correlation (DCC)–generalized autoregressive conditional heteroscedasticity (GARCH) model to examine whether wheat import dependency could make a country vulnerable to overseas shocks by analyzing the inter-relationships between the international wheat price and retail wheat flour prices in 10 net importing countries over the sample period from January 2005 to December 2019. It was found that retail price volatility in each region was positively correlated with international price volatility for most of the period concerned. We also discovered that external dependency could significantly protect the domestic market from the global one, implying that lowering wheat dependency on foreign markets improves “stability” and “availability” of food security without sacrificing “utilization”, but it may aggravate “access”. |
topic |
import dependency wheat price volatility transmission GARCH DCC |
url |
https://www.mdpi.com/2304-8158/10/8/1715 |
work_keys_str_mv |
AT pengfeiluo foodimportdependencyandnationalfoodsecurityapricetransmissionanalysisforthewheatsector AT tetsujitanaka foodimportdependencyandnationalfoodsecurityapricetransmissionanalysisforthewheatsector |
_version_ |
1721193323967807488 |