An Update

Dani Rodrik published the response by Oxfam to his post I commented yesterday. Here is the response:

Oxfam International and other organisations stand accused of focusing too heavily on the losers from food price movements, giving the impression that whatever food prices do, poverty gets worse. However this is more than an academic gripe about NGOs being unnuanced and simplistic. It is claimed that the myopic focus on losers results in myopic policymaking. I don’t accept for one moment that this is the case by the way, but let’s start with the question of nuance.

Charge number one: Oxfam, and other international organisations, failed to make sufficient mention of the benefits to consumers of low food prices during the pre-2007/08 era. Here’s a report from 2005 recognising that consumers do benefit from artificially lower prices (whilst poor producers lose out). The paper argues that a more efficient, transparent and far less messy way to provide support to consumers would be through social protection. This would also have the added benefit of not destroying poor farmers’ livelihoods.

Charge number two: Oxfam, and other international organisations, failed to discuss the benefits to producers of higher prices during the crisis of 2007/08. Not guilty. An Oxfam report from 2008 showed that some countries benefited from the price spike, but a greater number lost out. It found the winners had invested heavily in agriculture and social protection. Among the losers, both rural and urban populations suffered.

Why did rural populations lose out in so many countries?

First, most of the rural poor were net consumers. Decades of rich country dumping and underinvestment in developing country agriculture probably helps explain this.

Second, many were unable to respond to price rises, due to poor access to credit, inputs, extension services and land – again a legacy of underinvestment.

Third, the struggle to respond was compounded by the nature of the price rise. This was not a nice, steady reversal of the previous two decades of stagnation. It was an economic shock: prices doubled over two years.

So Oxfam definitely nuances its reports, just not its headlines. And this is the real complaint. But seriously, what is expected of a campaigning organisation? Oxfam’s role is to raise urgent issues up the agendas of policymakers, politicians and publics precisely to help the losers – whether they are losers from conflicts and disasters, drug pricing policies, or in this case food price movements. I’m afraid this usually means a myopic focus on losers in messaging, albeit perhaps to the detriment of our academic credibility. But it does not follow that the result is bad policy-making.

Why? Because whether Oxfam was drawing attention to the corrosive impact of dumping on food producers in 2005, or the calamitous effects of spiralling food prices on food consumers in 2008, its policy prescriptions remained the same:

  • increase investment in developing country agriculture;
  • dismantle trade distorting subsidies in the North;
  • increase social protection to protect poor food consumers.

I welcome the accusation that Oxfam focuses only on losers in its messaging, irrespective of whether prices rise or fall. That’s our job. But I do not accept the implication that Oxfam policy (and by a flattering extension, public policymaking) yo-yos around as food prices rise and fall. It simply does not stand up.

P.S. And here is a response to Oxfam’s response.

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