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Global Market Shocks and Poverty in Vietnam: The Case of Rice

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  • Coxhead, Ian

    (University of WI)

  • Linh, Vu Hoang

    (National University of Hanoi)

  • Le, Dong Tam

    (University of WI)

Abstract

World food prices have experienced dramatic increases in recent years. These "shocks" affect food importers and exporters alike. Vietnam is a major exporter of rice, and rice is also a key item in domestic production, employment and consumption. Accordingly, rice price shocks from the world market have general equilibrium impacts and as such, their implications for household welfare are not known ex ante. In this paper we first present a simple framework for understanding the direct and indirect welfare effects of a global market shock of this kind. Second, we quantify the transmission of the price shock from global indicator prices to domestic markets. Third, we then we use an applied general equilibrium (AGE) model to simulate the effects of domestic price changes in more detail. Fourth, a recursive mapping to a large nationally representative living standards survey permits us to identify in detail the ceteris paribus effects of the shock on household incomes and welfare. In this analysis, interregional and intersectoral adjustments in the labor market emerge as key channels transmitting the effects of global price shocks across sectors and among households.

Suggested Citation

  • Coxhead, Ian & Linh, Vu Hoang & Le, Dong Tam, 2011. "Global Market Shocks and Poverty in Vietnam: The Case of Rice," Staff Paper Series 559, University of Wisconsin, Agricultural and Applied Economics.
    • Handle: RePEc:ecl:wisagr:559
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    Cited by:

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    3. Dwayne Benjamin & Loren Brandt & Brian McCaig, 2017. "Growth with equity: income inequality in Vietnam, 2002–14," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 15(1), pages 25-46, March.
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    5. Mai, Nhat Chi, 2013. "Essays on Farm Household Decision-Making: Evidence from Vietnam," OSF Preprints 96azx, Center for Open Science.
    6. Nhan, Tran Quoc & Gillette, Raulston & Yutaka, Tomoyuki & Can, Nguyen Duy, 2020. "Impact of Outgrower Scheme on Yield,Output Price,and Income: A Rice-Farm-Level Study in the Mekong Delta,Vietnam," Hitotsubashi Journal of Economics, Hitotsubashi University, vol. 61(1), pages 1-19, June.
    7. Mofya-Mukuka, Rhoda & Abdulai, Awudu, 2013. "Policy reforms and asymmetric price transmission in the Zambian and Tanzanian coffee markets," Economic Modelling, Elsevier, vol. 35(C), pages 786-795.
    8. Hoang, Viet-Ngu & Vu, Duc-Cuong, 2021. "On the effects of trade on multidimensional deprivation: Evidence from Vietnam’s rice growing households," Economic Analysis and Policy, Elsevier, vol. 71(C), pages 476-485.
    9. An, Henry & Qiu, Feng & Zheng, Yanan, 2016. "How do export controls affect price transmission and volatility spillovers in the Ukrainian wheat and flour markets?," Food Policy, Elsevier, vol. 62(C), pages 142-150.
    10. Hoa K. Hoang, 2018. "Analysis of food demand in Vietnam and short†term impacts of market shocks on quantity and calorie consumption," Agricultural Economics, International Association of Agricultural Economists, vol. 49(1), pages 83-95, January.
    11. Ho, Manh-Toan, 2020. "The rise of research on development economics in Vietnam: Analyses and implications for the public and policymakers from SSHPA 2008-2020 dataset," Thesis Commons msy6e, Center for Open Science.
    12. , Aisdl, 2020. "The rise of research on development economics in Vietnam: Analyses and implications for the public and policymakers from SSHPA 2008-2020 dataset," OSF Preprints 9nbyr, Center for Open Science.
    13. Trung X. Hoang & Cong S. Pham & Mehmet A. Ulubaşoğlu, 2016. "The role of rice in poverty dynamics in rural Vietnam: 2002–2008," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 21(1), pages 132-150, January.
    14. Andy McKay & Finn Tarp, 2014. "Distributional Impacts of the 2008 Global Food Price Spike in Vietnam," WIDER Working Paper Series wp-2014-030, World Institute for Development Economic Research (UNU-WIDER).
    15. McKay, Andy & Tarp, Finn, 2014. "Distributional impacts of the 2008 global food price spike in Vietnam," WIDER Working Paper Series 030, World Institute for Development Economic Research (UNU-WIDER).
    16. Manh-Toan Ho & Ngoc-Thang B. Le & Manh-Tung Ho & Quan-Hoang Vuong, 2022. "A bibliometric review on development economics research in Vietnam from 2008 to 2020," Quality & Quantity: International Journal of Methodology, Springer, vol. 56(5), pages 2939-2969, October.
    17. Pham, Thai Thuy Pham & Dao, The Anh & Theuvsen, Ludwig, 2017. "Determinants of Specialty Rice Adoption by Smallholder Farmers in the Red River Delta of Vietnam," GlobalFood Discussion Papers 262581, Georg-August-Universitaet Goettingen, GlobalFood, Department of Agricultural Economics and Rural Development.
    18. Arief Anshory Yusuf, 2015. "External Shocks And Poverty: How Recession In Europe, Japan, And China Affects The Indonesian Poor," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 18(2), pages 207-228, October.
    19. Le Ngoc, H., 2018. "Contract farming effects on technical efficiency of the export-oriented rice production sector in Vietnam," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277409, International Association of Agricultural Economists.
    20. Mofya-Mukuka, Rhoda & Abdulai, Awudu, 2013. "Effects of Policy Reforms on Price Transmission in Coffee Markets: Evidence from Zambia and Tanzania," Food Security Collaborative Working Papers 171870, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    21. Vincenzo Salvucci & Finn Tarp, 2024. "Assessing the Impact of Covid-19 in Mozambique in 2020," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 36(4), pages 803-840, August.

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    JEL classification:

    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade

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