Analysis of the Nexus Between Food Price Rise, Food Security, and Poverty in Sri Lanka

Thematic Area: Agriculture & Food Security

Start Date: September 19, 2024

The main objective of the proposed research study will be to analyse the nexus between food prices, welfare programmes and poverty in Sri Lanka. Specifically, the study aims to:

1. Estimate expenditure and price elasticities of demand for major food categories in Sri Lanka using the Quadratic Almost Ideal Demand System (QUAIDS) model.
2. Assess the impact of food price increases on poverty by applying the Foster–Greer–Thorbeck (FGT) poverty index on household compensating variance (CV)-reduced expenditure before and after the price increase.
3. Investigate whether the welfare programmes have a positive impact on food security, household welfare, and poverty.

The study findings are expected to inform government policy responses in areas such as price policies, social welfare policies, and trade policies.