Does the Energy Transition Affect Food Prices and Agricultural Production?

33 Pages Posted: 29 May 2024

See all articles by Luccas Assis Attílio

Luccas Assis Attílio

Universidade Federal de Ouro Preto (UFOP)

Emilson Silva

University of Auckland Business School

Date Written: May 29, 2024

Abstract

While most studies highlight the benefits of the energy transition, it is important to recognize that this process can also yield negative consequences. In this study, we delve into this aspect of the energy transition by examining its effects on food prices and agricultural production across 32 OECD countries from 2000 to 2021. Our findings reveal that the energy transition leads to increased food prices and decreased agricultural production. Causality analysis further confirms that the energy transition is responsible for these changes. To deepen our understanding, we divided the countries into two subsamples: those in an advanced stage of the energy transition and those in a delayed stage. Our results show that the impact of the energy transition varies depending on the stage of transition. Countries further along in their energy transitions experience a greater effect. This investigation underscores a collateral effect of the energy transition, placing additional pressure on vulnerable populations. To address this social challenge, governments can implement programs and policies such as income transfers to support these groups.

Keywords: Energy Transition, Food prices, Agricultural Production, China, Commodity prices

Suggested Citation

Attílio, Luccas Assis and Silva, Emilson, Does the Energy Transition Affect Food Prices and Agricultural Production? (May 29, 2024). The University of Auckland Business School Research Paper Forthcoming, Available at SSRN: https://ssrn.com/abstract=4847337 or http://dx.doi.org/10.2139/ssrn.4847337

Luccas Assis Attílio (Contact Author)

Universidade Federal de Ouro Preto (UFOP) ( email )

Ouro Preto, Minas Gerais
Brazil

Emilson Silva

University of Auckland Business School ( email )

12 Grafton Rd
Private Bag 92019
Auckland, 1010
New Zealand

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