Importing High Food Prices by Exporting: Rice Prices in Lao Pdr

40 Pages Posted: 20 Apr 2016

See all articles by Dick Durevall

Dick Durevall

Göteborg University - School of Business, Economics and Law

Roy van der Weide

World Bank; World Bank - Development Research Group (DECRG)

Date Written: November 1, 2014

Abstract

This paper shows how a developing country, Lao PDR, imports high glutinous rice prices by exporting its staple food to neighboring countries, Vietnam and Thailand. Lao PDR has extensive export controls on rice, generating a sizable difference between domestic and international prices. Controls are relaxed after good harvests, leading to a surge in exports early in the season and rapidly rising prices later in the year. There is thus a strong case for removal of trade restrictions since they give rise to price spikes, keep the long-term price of glutinous rice low, and thereby hinder increases in income from agriculture. Although this is a case study of Lao PDR, the findings may equally apply to other developing countries that export their staple food.

Keywords: Agricultural Trade, Food Security, Nutrition, Agricultural Economics, Trade and Agriculture

Suggested Citation

Durevall, Dick Johnny and van der Weide, Roy, Importing High Food Prices by Exporting: Rice Prices in Lao Pdr (November 1, 2014). World Bank Policy Research Working Paper No. 7119. Available at SSRN: https://ssrn.com/abstract=2530253

Dick Johnny Durevall (Contact Author)

Göteborg University - School of Business, Economics and Law ( email )

Box 605
Goteborg, 40530
Sweden

Roy Van der Weide

World Bank ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

World Bank - Development Research Group (DECRG)

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States

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