Between 2000 and 2011, prices for most globally traded commodities more than doubled. Since cresting in early 2011, however, oil and industrial metals prices have halved. As the saying goes, however: What’s that got to do with the price of eggs? Not much. Unlike other commodities, global food prices have followed a different trajectory. Although down from near-historic highs in 2007-2008 and 2011, they are still higher than at any point in the previous three decades.
The economic effects of higher food prices are clear: Since 2007, higher prices have put a brake on two decades of steady process in reducing world hunger. But the spikes in food prices over the past decade have also thrust food issues back onto the security agenda, particularly after the events of the Arab Spring. High food prices were one of the factors pushing people into the streets during the regionwide political turmoil that began in late 2010. Similar dynamics were at play in 2007-2008, when near-record prices led to food-related protests and riots in 48 countries.
To what extent might high or rising food prices be a source of political instability? Food prices are the quintessential “kitchen table issue,” important even to those with no interest in politics. They’re especially salient in lower-income countries, where food-related expenditures often surpass 50 percent of household income. Unlike energy and electronics, demand for basic foodstuffs is income-inelastic: Whether I have adequate income has no effect on my need for sustenance. Not surprisingly, 97 percent of the post-2007 ‘food riots’ identified by a team at the New England Complex Systems Institute occurred in Africa and Asia, which are home to more than 92 percent of the world’s poor and chronically food-insecure. Careful empirical work bears out this conventional wisdom: High global food prices are more destabilizing in low-income countries, where per capita incomes are lower.
Poverty isn’t the whole story, however. Food is an inherently political commodity and has been recognized as so for millennia. Nearly 2,000 ago, the Roman poet Juvenal noted that providing bread and circuses was an effective means of securing urban stability. In a recently published article in the Journal of Peace Research, we studied the relationship between food prices and urban unrest in Africa and Asia over 1961-2010, which included a period of price spikes in the 1970s. Our objective was to tease out how political institutions might affect the propensity for mass mobilization and protest.
Politics might affect the relationship between food prices and protest through two channels. The first is the extent to which governments shield urban consumers from high global prices. Governments in developing countries often subsidize food purchases, especially those of urban dwellers, shifting welfare from rural producers to urban consumers. But this observation raises the second-order question of the conditions under which governments will subsidize urban consumers. We hypothesized that autocratic governments were more likely to shield urban consumers. While urban dwellers can riot in the absence of elections, rural dwellers have fewer channels through which they can voice grievances.
Protest is also affected by the political opportunity structure: the opportunities for civil society to organize and mobilize. Famine in North Korea may have claimed as many as a million lives during the first half of the 1990s, but no rioting or demonstrations occurred in Pyongyang. Meanwhile, food-related protests are routine in more open systems such as India, where comparatively small price movements in the presence of ample stocks routinely bring trade unions into the streets.
Our empirical analysis concluded that democracies and to a lesser extent anocracies (or “hybrid regimes” that combine democratic and authoritarian elements) experience more urban unrest in times of high prices; there is no relationship between food prices and urban unrest in autocracies.
However, is this outcome the result of more pro-rural policies in democracies or a more liberal environment for protest? We found that democracies and anocracies did enact more pro-rural food policy. In particular, democracies in Africa and Asia enact policies that favor urban areas less and rural areas more. These take the form of enhancing farmer incomes and raising consumer prices, which often causes protests and rioting. Lessening urban bias in food policy may be good pro-poor policy, given the continued concentration of poverty in rural areas, but it carries political risks.
What of the Arab Spring? These popular uprisings seem to challenge our findings, because they reflected autocracies that failed to pacify restive urban populations. However, it was not for lack of trying. Rather, the Arab Spring reflects some of the risks autocratic leaders face when attempting to insulate urban consumers from global market prices. Consumer subsidies have long been part of the “authoritarian bargain” between the state and citizens in the Middle East and North Africa, and attempts to withdraw them have been met with protest before: Egypt’s bread intifada, which erupted over an attempt to reform food subsidies, killed 800 in 1977. These subsidies explicitly encouraged citizens across the region to evaluate their governments’ effectiveness in terms of their ability to maintain low consumer prices — prices that, given these countries’ dependence on food imports, those governments ultimately could not control.
What can be done to decouple food price shocks from political upheaval? Most favored policy instruments for addressing acute food crises (means-tested targeted transfers, such as food stamps) are likely to be ineffective: As the somewhat portly “Bread Helmet Man” of the Arab Spring made clear, food price-related protests don’t often involve the most acutely food insecure.
In the near term, one thing the international community should do is act collectively to address export bans. Although it not widely recognized, the 2010 ban on Russian grain exports roiled markets and may have even helped catalyze Arab Spring protests. Export bans are a perfect example of a collective action problem amenable to international cooperation: They are individually rational but impose substantial costs on the entire system. One possible solution would be to replace producer subsidies in developed countries with a disavowal of export restrictions. At least, food trade should be more fully integrated into the World Trade Organization’s dispute settlement mechanisms, which would allow WTO members to bring cases for adjudication and even impose retaliatory tariffs.
Global commodity markets may have cooled of late, but food prices are likely to remain a hot-button political as well as economic issue. Our findings point to the difficult tradeoffs facing governments in developing countries as they attempt to pursue two different definitions of food security simultaneously: food security as an element of human security, and food security as a means of ensuring government survival and quelling urban unrest. These tradeoffs appear to be particularly acute for developing democracies.
Cullen Hendrix is assistant professor at the Josef Korbel School of International Studies at the University of Denver and nonresident senior fellow at the Peterson Institute for International Economics. Stephan Haggard is the Lawrence and Sallye Krause Professor of Korea-Pacific Studies at School of International Relations and Pacific Studies at the University of California at San Diego.