Do Commodity Prices and Food Production Affect the Volume of United States Foreign Food Aid?
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2009
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Haverford College. Department of Economics
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eng
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Abstract
The main focus of this paper is to analyze whether a country-specific commodity price index and a food production index have strong explanatory power on determining the volume of United States foreign food aid flows to low-income countries. The study uses panel data for seventy-six countries spanning from 2001-2007. I ran three regression models: two ordinary least squares regressions with fixed effects and a conditional logit model. The results I find are that the commodity price index variable has low explanatory power and that many of the country-specific attributes, including those that relate it to the donor (U.S.) are more significant. Lastly, food aid should be purely a humanitarian program by the United States, but political, strategic, and income factors play an important role in determining the allocation of US food aid flows.