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Citation Information

Type Journal Article - World Journal of Agricultural Research
Title Food Prices Volatility in Rwanda: A VAR Model
Author(s)
Volume 2
Issue 6
Publication (Day/Month/Year) 2014
Page numbers 296-302
URL http://pubs.sciepub.com/wjar/2/6/9/
Abstract
Market is the main arbiter of how the available food is distributed both within and between countries. Food price volatility informs consumers and price analysts on the availability of food in the region. Food price surges reduce purchasing power of households that are weekly linked to markets and remain obstacle in the way to feed the poor adequately. Thus, Food price surges lead poor people to limit their food consumption and shift to even less-balanced diets, with harmful effects on health in the short and long run. Applying a Vector Autoregressive Model that combines monthly price information on Sorghum, Maize, Rice, Wheat, Irish Potato, and Beans from January, 2007 to December, 2013, this paper tries to forecast food prices volatility in Rwanda and to find out which food commodities’ price volatility granger cause price volatility in the other food commodities. In the light of the government of Rwanda efforts aimed to ensure food security to its population, food price volatility could capture the attention of the government of Rwanda. Therefore, food price policies should be oriented to the stabilization of price of food commodities which price volatility granger cause price volatility in the other food commodities.

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