A shortfall in food supply that arose from multiple bad harvests around the world and that was large by historical standards would not necessarily result in rapid price increases, given that other important factors affect price fluctuations. If a sufficient number of preceding good harvests had helped to build up stocks, if growth in biofuel demand related to energy policies slowed or reversed, or if a global recession reduced aggregate food demand, supply shortfalls could have relatively little influence on global markets. However, when bad harvests occur in an already tight market, this will generally result in large increases in food prices, as analyses of recent episodes of high prices in 2007–2008 and 2010–2011 have emphasized (Abbott et al., 2008, 2011; Wright, 2011). Policy responses to the initial shortfalls, such as export bans designed to stabilize domestic markets, then often act to further amplify price changes.

In light of recent food price increases, there has been a renewed interest in the effects of high international food prices on domestic prices and social and political stresses. One clear finding is that domestic prices in many countries change substantially less than global prices, partly because of exchange rate variability and partly because of policies aimed at stabilizing domestic prices, such as tariff adjustments, export restrictions, and the use of government storage (Dawe, 2008; Naylor and Falcon, 2010). Nonetheless, in 2008 and 2011 most countries witnessed significant increases in prices versus historical levels, with consequences for local producers and consumers.

The susceptibility of national populations to global price increases depends in large part on the countries’ net trade positions: Major importers will generally be hurt, and exporters will benefit. The MENA (Middle East and North Africa) region is the main area of the world that relies on food imports for a large (more than 30 percent) fraction of calories consumed. Wheat prices are especially important in the MENA, given that nearly half of all calories consumed in some countries are from wheat (Food and Agriculture Organization of the United Nations, 2012). A recent World Bank study (Ianchovichina et al., 2012) found that MENA countries are highly vulnerable to global food price shocks. Sub-Saharan Africa is also relatively dependent on food imports, with roughly 40 percent of rice and 70 percent of wheat consumption derived from imports (Naylor and Falcon, 2010).

Because the prices of basic commodities such as bread or flour are often subsidized, demonstrations and even riots frequently occur in response to efforts by governments to reduce subsidies, for example as part of structural adjustment policies. In general these disturbances are contained without an impact on the regime, even if there may be significant violence or property damage. The issue with regard to climate change is whether that pattern could change and that the countries most vulnerable to food price increases could become vulnerable to severe social and political unrest. Unfortu-



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