Market Structure and Resilience of Food Supply Chains Under Extreme Events
AAEA members and Past President release new study in AJAE
Recent extreme events, like the COVID-19 pandemic and the war in Ukraine, instigated disruptions in food supply chains. These disruptions have prompted policymakers to carefully consider strategies to enhance the resilience of the food supply chain to ongoing and future extreme events. Some new research published in the American Journal of Agricultural Economics offers insight into these discussions and evaluates the effectiveness of policies that were implemented in the initial months after the pandemic.
In the new article “Market Structure and Resilience of Food Supply Chains Under Extreme Events,” Jeffrey Hadachek and Richard Sexton from the University of California, Davis as well as Meilin Ma from Purdue University, evaluate the impacts of policy interventions aimed at increasing the resilience of agriculture and food supply chains when extreme events occur.
The authors say, “While there are modest improvements to supply chain resilience from these policies when extreme shocks occur, they often come at the cost of production efficiency and social welfare. Resilience-enhancing policies are most effective in agriculture and food markets that exhibit higher levels of market power. In general, our model finds that increasing competition in ag and food markets has the most potential to improve the resilience of supply chains.”
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ABOUT AAEA: Established in 1910, the Agricultural & Applied Economics Association (AAEA) is the leading professional association for agricultural and applied economists, with 2,500 members in more than 60 countries. Members of the AAEA work in academic or government institutions as well as in industry and not-for-profit organizations, and engage in a variety of research, teaching, and outreach activities in the areas of agriculture, the environment, food, health, and international development. The AAEA publishes three journals, the Journal of the Agricultural and Applied Economics Association (an open access journal), the American Journal of Agricultural Economics and Applied Economic Perspectives & Policy, as well as the online magazine Choices and the online open access publication series Applied Economics Teaching Resources. To learn more, visit www.aaea.org.
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