Abstract
This paper explores the complex nexus between the global oil prices and the food prices of the Middle East and North Africa (MENA) region during the period 2000–2020. Both linear and nonlinear models of the autoregressive distributed lag (ARDL) approach are adapted into panel data form to investigate the symmetrical and asymmetrical influence of oil prices on food prices. The key results are summarized: (i) the long-term effect of oil prices on food prices is significantly positive including both oil-exporting and oil-importing nations. The positive impact on oil exporters—due to higher oil revenues—is greater than importing nations, leading to an increased demand for food. Additionally, the effect on oil exporters is negative and significant in the short term but not significant for importers. (ii) The nonlinear ARDL panel analysis for the whole MENA sample confirms the presence of negative short-term asymmetric behaviour due to the heterogeneous response within the oil-importing and oil-exporting samples, while in the long term, the asymmetric effect is positive, indicating that food prices increase regardless of fluctuations in oil prices. (iii) The nonlinear ARDL results using time series affirm the absence of an asymmetric nexus among oil and food prices for some oil-exporting nations (including Kuwait, Saudi Arabia, United Arab Emirates) and Tunisia within the oil-importing group. However, the food prices of other countries are asymmetric to the oil price. This study provides recommendations that are useful to MENA countries to establish a stable mechanism for oil and food prices to ensure food security in the region.
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Acknowledgements
The authors are thankful to the editors and the anonymous reviews for their valuable comments and suggestions on this paper. This work was supported by the Beijing Natural Science Foundation of China (9192006), the National Natural Science Foundation of China (72073008), the National Social Science Foundation China (21ZAA055), Capital Circulation Research Base of China (JD-ZD-2021-003) and the Science and Technology Innovation Service Ability-Beijing Technology and Business University Cultivation Funds of Outstanding Youth Scholars (19008020111) for their financial support.
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Conceptualization, methodology and funding acquisition: Hadj Cherif Houda and Guohua Ni; analysis and interpretation: Hadj Cherif Houda and Zhenling Chen; writing, review and editing: Hadj Cherif Houda, and Zhenling Chen; final approval of the article: Zhenling Chen and Guohua Ni; overall responsibility: Hadj Cherif Houda, Zhenling Chen, Guohua Ni. Zhenling Chen and Guohua Ni contributed equally to this work and share the corresponding author.
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Appendix
Appendix
The cumulative effect of oil price on food price in oil exporters group
The cumulative effect of oil price on food price in oil importers group
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Hadj cherif, H., Chen, Z. & Ni, G. Modelling the symmetrical and asymmetrical effects of global oil prices on local food prices: A MENA region application. Environ Sci Pollut Res 28, 65499–65512 (2021). https://doi.org/10.1007/s11356-021-14842-1
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DOI: https://doi.org/10.1007/s11356-021-14842-1