IMPROVING FOOD POLICIES FOR A CLIMATE INSECURE WORLD: EVIDENCE FROM ETHIOPIA

Abstract

Climate change and weather shocks have multi-faceted impacts on food systems with important implications for economic policy. Combining a longitudinal household survey with high-resolution climate data, we demonstrate that both climate and weather shocks increase food insecurity; cash assistance and participation in Ethiopia’s Productive Safety Net Programme have reduced food insecurity; but food assistance has been ineffective. Importantly, households with savings, and those that stored their harvest to sell at higher prices rather than for home use, suffered less from food insecurity, yet both strategies are harder for the poorest and most food insecure households to adopt. Our paper provides micro-founded evidence needed to design policies that both improve agricultural yields in the context of a changing climate and target households’ abilities to cope with shocks that put upwards pressure on food prices.