While rising food prices threaten to increase poverty, they are not quite the unmitigated disaster that they are sometimes represented to be, at least according to Dani Rodrik. Rodrik points out that the effect of rising food prices on the world's poor depends on whether the poor are net producers or consumers of foodstuffs:
The fact is that millions of very poor growers of rice and other food products are much better off as a result [of rising prices]. The poor that are affected the worst are the urban poor, not the rural poor.
Nevertheless, the net effect of rising food prices on global poverty in the short term is probably still negative, given the number of urban poor. But in the longer run, it's more of an open question. A permanent rise in food prices might prompt a shift in the allocation of labor to the agricultural sector. (This is the kind of thing that may already be happening in Brazil and could spread to other emerging markets.) Increased demand for agricultural labor could help reduce poverty, but it is not without risks.
If we are to believe the dire predictions of a recent report from Oxfam, climate change is making the agricultural sector increasingly risky because of much more variable weather patterns. Last week Oxfam released a report on the effects of climate change on poverty in Uganda called Turning Up the Heat. Among its dire predictions, the report claims that
[t]he future outlook, however, is bleak: if average global temperatures rise by 2 degrees more - as they are almost certainly going to do - then most of Uganda is likely to cease to be suitable for coffee. According to the UN Environment Programme, only patches of land on the periphery would still be able to grow coffee. This may happen within about 40 years, or perhaps as little as 30.
I won't try to get into assessing the validity of this kind of prediction. That's a risky business in and of itself. But I will point out that Oxfam is definitely not the only one making the point that developing nations will bear the brunt of climate change - this piece from the Atlantic concurs. These two trends together - a shift in labor to the agricultural sector and increasingly volatile weather patterns - seem to me to pose a serious long-term risk to poverty reduction efforts.
Join the Conversation