Food Price Inflation and Its Effects on Food Insecurity in Ethiopia: Using a Household Level Panel Dataset

Abstract

The purpose of this study is to investigate how Ethiopian households' food security situation is impacted by rising food prices. The panel dataset used in this study came from waves one, two, and three of Ethiopia's living standard measuring survey. The fixed-effect logistic regression model has been used for this. The findings showed that, on average, 49.99%, 59.65%, and 64.91% of Ethiopian households experienced food security between 2011/12 and 2014/15. The results of the fixed effect logistic regression model showed that price shock, gender (female), household size in adult equivalent, food price inflation, and distance to market were were favourably correlated with Ethiopia's food insecurity. However, the chance of food insecurity is negatively impacted by a number of factors, including geography (both large and small towns), nonfarm enterprise, house ownership, employment, and educational attainment. This leads to the conclusion that while education, off-farm income, and access to a home positively impacted households' food security in Ethiopia, family size, shocks, inflation of food prices, and a lack of infrastructure increased the likelihood that households would be food insecure. Additionally, this predicts that price volatility and food insecurity will be major issues in the future. Therefore, in order to guarantee a sustainable supply of food, governments should endeavour to stabilise the food market, provide households with the means and chances to raise their per capita income, and develop more simple and faster measures to handle food market management.