Tracing The Impacts Of Food Aid On Agriculture And Consumers A Computable General Equilibrium Approach.

This paper has analyzed the impact of four different food aid shocks on production,rnprices and welfare on different household groups in Ethiopia, using a computablerngeneral equilibrium (CGE) model and a social accounting matrix constructed forrnEthiopia. The researcher simulated the impact of (i) a 20 percent decline in in-kindrnfood am, (ii) a 20 percent in-kind food aid cut replaced by direct cash transferrnequivalent, (iii) abolishment of in-kind emergency food aid, and (iv) all in-kindrnemergency food aid converted into mrect cash transfer equivalentrnthe results suggest that food aid has some disincentive effects on food cropsrnproduction through reduced prices. the simulation of the partial as well as the fullrnshift from in-kind emergency food aid to direct cash transfer equivalent has positivernbut not large effects on food crops price. Moreover, direct cash transfer hasrnexpansionary effects on local agricultural production.policy implication is that to limit the use of in-kind food aid to situations of localrnfood shortage. In other situations, food aitl should be provided in cash form tornpurchase food locally or regionally.

Get Full Work

Report copyright infringement or plagiarism