Do higher food prices help or hinder poverty reduction? Despite much debate, existing research has almost solely relied on simulation models to address this question. In this paper World Bank poverty estimates are used to systematically test the relationship between changes in poverty and exogenous changes in real domestic food prices.

From 2003 to their peak in mid 2008, the nominal prices of maize and wheat roughly doubled, while those of rice tripled in a matter of months rather than years.