Economics, Econometrics and Finance
5 years ago

Rising fuel prices driving up food costs in India, study finds.

Journal of Business Thought
Cereal and Fuel Price Interactions: Econometric Evidence from India
Aparna Sajeev, Harpreet Kaur, Simrit Kaur

Paper Summary

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Fuel prices have a big impact on food prices, especially in India. The study looked at how changes in fuel prices affect the cost of cereals. They found that when international cereal and fuel prices go up, so do domestic cereal prices. However, shocks to fuel prices don't have much effect on domestic food prices in the long run. This is important to consider because of India's bio-fuel policy and recent changes in fuel prices.