The Effects of Rising Food and Fuel Costs in Pakistan

The Lahore Journal of Economics, Special Edition, pp. 117-138, September 2008

25 Pages Posted: 24 Nov 2009

See all articles by Azam Chaudhry

Azam Chaudhry

Lahore School of Economics - Department of Economics

Theresa Thompson Chaudhry

Lahore School of Economics

Date Written: September 2008

Abstract

The dramatic increase in international food and fuel prices in recent times is a crucial issue for developing countries and the most vulnerable to these price shocks are the poorest segments of society. In countries like Pakistan, the discussion has focused on the impact of substantially higher food and fuel prices on poverty. This paper used PSLM and MICS household level data to analyze the impact of higher food and energy prices on the poverty head count and the poverty gap ratio in Pakistan. Simulated food and energy price shocks present some important results: First, the impact of food price increases on Pakistani poverty levels is substantially greater than the impact of energy price increases. Second, the impact of food price inflation on Pakistani poverty levels is significantly higher for rural populations as compared to urban populations. Finally, food price inflation can lead to significant increases in Pakistani poverty levels: For Pakistan as a whole, a 20% increase in food prices would lead to an 8% increase in the poverty head count.

Keywords: Pakistan, Poverty, Inflation, Household Budget, Food, Fuel

JEL Classification: D33, E3, R21

Suggested Citation

Chaudhry, Azam Amjad and Chaudhry, Theresa Thompson, The Effects of Rising Food and Fuel Costs in Pakistan (September 2008). The Lahore Journal of Economics, Special Edition, pp. 117-138, September 2008, Available at SSRN: https://ssrn.com/abstract=1510063

Azam Amjad Chaudhry

Lahore School of Economics - Department of Economics ( email )

Intersection Main Boulevard
Phase VI DHA and Burki Road
Burki, Lahore 53200
Pakistan
92-42-3656-0969 (Phone)

Theresa Thompson Chaudhry (Contact Author)

Lahore School of Economics ( email )

Intersection Main Boulevard
Phase VI DHA and Burki Road
Burki, Lahore 53200
Pakistan
011-92-42-656-0969 (Phone)

HOME PAGE: http://www.lahoreschoolofeconomics.edu.pk

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
235
Abstract Views
1,263
rank
154,584
PlumX Metrics