理解通貨膨脹的食品成分-BIS

lationheenMonetaryandEconomicDepartmentJELclassification:E30;E31;E32;E50;F14;Q00.oodexportfoodpricesfoodimport,foodproduction,forecast;inflation,outputgap,Phillipscurve.NprintonlineBISWorkingPapersarewrittenbymembersoftheMonetaryandEconomiceconomists,andarepublishedbytheBank.ThepapersareonsubjectsoftopicaledinthemarethoseoftheirauthorsandnotnecessarilytheviewsoftheBIS.ThispublicationisavailableontheBISwebsite().BankforInternationalSettlements2022.Allrightsreserved.Briefexcerptsmaybereproducedortranslatedprovidedthesourceisstated.tandingtheFoodComponentofInflationEmanuelKohlscheen1,2AbstractThisarticlepresentsevidencebasedonapanelof35countriesoverthepast30yearsthatthePhillips’curverelationholdsforfoodinflation.Thatis,broadereconomicoverheatingdoespushupthefoodcomponentoftheCPIinasystematicway.Further,generalinflationexpectationsfromprofessionalforecastersclearlyimpactfoodpriceinflation.Theanalysisalsoquantifiestheextenttowhichhigherfoodproductionandimports,orlowerfoodexports,reducefoodinflation.Importantly,thelinkbetweendomesticandglobalfoodpricesistypicallyweak,withpass-throughswithinayearrangingfrom0.07to0.16,afterexchangeratevariationsaretakenintoaccount.JELClassification:E30;E31;E32;E50;F14;Q00.Keywords:crop;expectations;energy;foodexport;foodprices;foodimport;foodproduction;forecast;inflation;outputgap;Phillipscurve.1SeniorEconomist,BankforInternationalSettlements,Centralbahnplatz2,4002Basel,Switzerland.E-Mailaddress:emanuel.kohlscheen@.2IamgratefultoDenizIganandDanielReesforhelpfulcommentsandtoEmeseKurucforresearchassistance.TheviewsexpressedinthispaperarethoseoftheauthoranddonotnecessarilyreflectthoseoftheBankforInternationalSettlements..IntroductionChangesinfoodpricesareoftentreatedasexogenousshockstomacroeconomicdevelopments,thatstrikeaccordingtothewhimsofnature.Theyarefrequentlyseenasanuisance,thatisnotworthmodelling.Yettheyareanimportantcomponentofconsumerbaskets.Theirweightoninflationoutcomesisrelevantinadvancedanddevelopingcountriesalike(seee.g.Peersman(2022)).Onaverage,foodandnon-beverageitemsrepresent17%ofconsumerpriceindicesinOECDcountries,rangingfromalowof8%intheUnitedStatesto27%inthecaseofPoland.3Becauseofthehighvolatilityoffooditemprices,theircontributiontothevariationofinflationcaneasilyexceedtheirweight.Further,becauseoftheirsalience,foodpricescouldhaveadisproportionateimpactoninflationexpectationsandmorereadilyspreadtoothercategories.Akeyresearchquestioniswhetherandtowhichextentfoodinflationrespondstobroaderdomesticmacroeconomicconditionssuchasoutputgapsorchangesinheadlineinflationexpectations.Forinstance,doeseconomicover-orunderheatingspill-overintofoodpricingIsthePhillipsrelationvalidforfooditemsAnswerstothesecorequestionsarekeyalsoforpolicymakers,astheymightforinstanceaffectthecalibrationofmonetarypolicy.Particularlyincountrieswheretheinflationtargetisbasedonheadlineinflation,theoptimalpolicyisboundtodifferdependingontheextenttowhichthefoodcomponentoftheCPIisresponsivetooutputgapsandinflationexpectationswhicharedirectlyinfluencedbymonetaryactions.Further,howstronglydoglobalfoodpricestransmittoretailfoodcosts?Andbyhowmuchcanlargercropyields,higherfoodimports–orconverselylowerfoodexports–contributetothealleviationofdomesticfoodprices?ThisarticleprovidesquantitativeanswerstoeachoftheabovequestionsbasedonimpulseresponsesobtainedthroughtheJordà(2005)localprojectionmethod.Thecross-countryanalysisrevealsthataPhillips’curverelationholdsforfoodinflation.Thatis,broadereconomicoverheatingdoespushupthefoodcomponentofCPIsinasystematicway.Thismaybepartlybecausemostretailfooditemsincorporatesomecostofservicesand/orpackaging.Further,generalinflationexpectationsfromprofessionalforecasterscouldimpactfoodpriceinflation.Thatis,foodpricesettersmaybeaffectedbythebroaderassessmentregardingfutureinflation.Togethertheseresultshighlightthatfoodpricedevelopmentsarenotexogenousbutdeeplyintertwinedwithbroadereconomicdevelopments.Itfollowsthatmacroeconomicstabilisationpoliciesalsoaffectdomesticfoodprices(asdofoodpolicieswhicharemuchmoretargeted).Whenitcomestotheeffectsofdomesticfoodproductionandinternationaltrade,thebaselineresultspointoutthata10%cropyieldincreasereducesfoodCPIinflationbyaround0.5%.Thecentralestimatesarethatthequantitativeeffectofasimilarincreaseinfoodimportsissomewhatsmaller,withpriceresponsesthatarenotalwaysstatisticallysignificant,indicatingimperfectsubstitutabilitywhenitcomestodampeningtheeffectsofeventuallocalcropshortfallsontheaggregatefoodCPI.Inturn,theneteffectofa10%increaseinfoodexportsisestimatedtobesmaller,at0.3%,likelyowing3SeeAppendixTableA1fortheweightineachcountrythatiscoveredinthisstudy.4Theirstudyhighlightstheroleofnon-linearitiesinthepass-throughfrominputtofinalprices.totheconcentrationofexportsonspecificproductswhicharenotrepresentativeofthetypicalconsumers’foodconsumptionbasket.Whatisnoteworthyisthattheconnectionofdomesticwithglobalfoodpricesistypicallyweak,withcentralestimatesforpass-throughswithinayearrangingfrom0.07to0.16,afterexchangeratevariationsareconsidered.Thisunderscoresthatglobalfoodpriceindicesareaveryimperfectproxyfordomesticfoodpricedevelopments.Finally,theeffectofenergycostsonfoodcosts,whilesignificantfromastatisticalviewpointatusualconfidencelevels,isfoundtobeeconomicallynegligible.Thenoveltyofthisarticleisthatitfillsagapintheliterature,byprovidingnovelcross-countryevidenceonthefactorsthatdrivethisvastlyunderexploredcomponentofCPIs.Whilethisisonlyafirststepforamuchbroaderresearchagenda,itcontributestoabetterunderstandingofretailfoodpricepressures.Suchunderstandingcouldprovekeytofoodpolicies,aswellasbroaderpoliciesaimingatpricestability.Relationtotheliterature.Asalreadyindicated,therecentliteratureonthedriversoffoodpricesfromamacroeconomicperspectiveissurprisinglyscant,particularlygiventhewidesocialandeconomicrepercussionsofthetopic.Whiletherearesomestudiescoveringspecificlow-incomecountries,studiesformiddle-andhigh-incomecountriesareratherfew.OnenotablerecentexceptionisPeersman(2022)’sstudy,basedonaSVAR-IVmodelfortheeuroarea.Heconcludesthatexogenousswingsininternationalfoodpricesexplainalargeportionofthemedium-termCPIvolatility.Earlierandsimilarly,theanalysisofFerrucietal(2010)hadconcludedthatcommoditypriceswerekeyforthe2007-08increaseininflation.4esticfoodCPIandexpectationsandthe“foodPhillipscurve”uncoveredinthecurrentpaperarenovel.Soisalsotheprecisequantificationoftheeffectsofcropyieldsandinternationalfoodtradetoretailfoodpricesinabroadcross-countrysetup.Thatsaid,country-specificstudiessuchasDurevalletal(2013),amongothers,alreadyexploredthelinkbetweendomesticagriculturalproductionandfoodprices.Incontrasttothestudiesmentionedabove,thedirectlinkofdomesticfoodpricesalpriceshadalreadybeenfoundtobeontheweaksideinearlierstudiesFurcerietal(2016)reporta1-yearpass-throughfromglobaltodomesticfoodpricesofonly0.05foradvancedeconomies,whichisevenlowerthanmycentralestimateof0.08forhighincomecountries.Theydoconjecturethatthelowerpass-throughinadvancedeconomiesmaybelinkedtogreaterestablishedcredibilityofmonetaryregimesinthese.Wheretheexistingliteratureonfoodpricesismostabundantisontheconnectionbetweenenergyandfoodprices.Avalos(2014)forinstancelooksattheincreasedsensitivityofcornpricestooilafterbiofuelpromotionpolicieswereintroducedintheUnitedStates.Thatsaid,theresultsofthecurrentanalysis–whicharebasedonmacrodata-alignmuchbetterwiththoseofLambertandMiljkovic(2010)andBaumeisterandKilian(2014)whofoundthatoilpricesarenotresponsibleformorethananegligibleshareoftheincreaseinretailfoodpricesintheUS,andlesswithIrzetal(2013)orBaekandWho(2014)whoreportanon-negligibleeffect.52.MethodologyInwhatfollows,theimpactofthedriversofCPIfoodinflationareanalysedbymeansofimpulseresponsesobtainedthroughthelocalprojectionmethodofJordà(2005).Plagborg-MollerandWolf(2021)showthatthismethodgivesresultsthatareequivalenttotheimpulseresponsesobtainedfromVARs.6Morespecifically,thebaselinepanelmodelQi,t+h=h+pi,tQi,t+1,hi,t+2,hEti,t+1+3,hygapi,t+4,hFYi,t+5,hFXi,t+6,hFMi,t+7,hoilt+8,hQ*t+9,htrendt+i,h+i,h,tisestimated.ThedependentvariableQi,t+histheannualvariationoffoodinflationinyeart+h,whereh=1orh=2,andQi,tstandsforalaggeddependentvariable.i,trepresentscurrentinflation(thatis,incountryiinyeart),Eti,t+1theexpectedinflationforthefollowingyear,sothatthespecificationhasabackward-lookingandaforward-lookinginflationelement.ygapi,tistheoutputgap,whichisintendedtocaptureanyeventualPhillipstyperelationinfoodprices.FYi,trepresentspercapitacropgrowthincountryiinyeart.FXi,tandFMi,tcapture,respectively,percapitafoodexportandimportgrowth.oiltreflectsthevariationinglobaloilprices.Q*tisthesecondglobalvariable,whichrepresentsvariationforglobalfoodpriceindex,asmeasuredindomesticcurrency.Atimetrendisaddedinsomespecificationstoallowforthepossibilityofaseculardriftinfoodprices.i,hrepresentscountryfixedeffects,whichcapturealsounobservedheterogeneities,andi,h,ttheerrorterm.75ThefindingthatthetimetrendinfoodpricesiseconomicallynegligibleappearstostandincontrastwithsupportforthePrebisch-Singerhypothesisfoundinotherstudies(e.g.Baffesetal(2016)andthemixedresultsobtainedbyArezkietal(2016)).Thatsaid,thisemergesmoreasaby-productinouranalysis,andisnotthefocusoftheanalysis.Thecurrentstudyisalsobynomeansthefirstthatfindsevidencethatappearstogoagainstthehypothesis(seeGilbert(2010)).6SeealsoOleaetal(2021).7Alternatively,afertilizerpriceindexwasalsoincludedascontrol.Thisfollowsfromthefactthatfertilizerpricepressuresoftentranslateintohigherfoodpricesdowntheroad(seeforinstanceIMF(2022,p.38).Thefertilizerpriceindexwasconstructedbasedontheaverageglobalpricevariationofphosphate,potassiumandurea(unweighted).TheinclusionofthisadditionalcontrolvariabledidnotchangetheNotethatallright-handvariablesinthespecificationareeffectivelylaggedrelativetotheleft-handvariable.Onedirectimplicationisthatthepredictedvaluescanindeedbeinterpretedasin-sampleforecastsofthefollowingyears’foodpriceinflationintherespectivecountriesandtimes.Alleconomicvariablesareinlogdifferences.Foodpriceinflation,thevariableofinterest,isthevariationinthefoodCPIreportedbytheOECD(i.e.group01oftheCOICOP2018classification).Thisgroupincludesbasicfooditems,8non-alcoholicbeverages(suchasfruitjuices,coffee,tea,cocoadrinks,waterandsoftdrinks),andservicesforprocessingprimarygoodsforfoodandnon-alcoholicbeverages.HeadlineinflationnumbersaresourcedfromtheIMF’sInternationalFinancialStatistics.FollowingyearinflationexpectationsweretakenfromConsensusEconomicsforeachDecember.Thesurveyisbasedonprofessionalforecastersresponses(mostlyfrombanks).DomesticfoodproductionandtradedataareindiceswhichwerecomputedbasedonWorldBankdataonthesevariablesandonthepopulationoftherespectivecountries.TheoutputgapestimatesarefromtheIMF’sWorldEconomicOutlook.9OilpricevariationsrefertoBrentoil,sourcedfromBloomberg,whiletheglobalfoodpricesarebasedontheFoodandAgricultureOrganization/UN(FAO)foodpriceindex.Thedatafrequencyisannual,spanningfrom1990to2020,for35countriesthatarelistedinAppendixTableA2.ThecompletevariablespecificationinTableA3andsummarystatisticsofthesecanbefoundinTableA4.Figure1showsthesamplemeans,rangesofvariationandstandarddeviationsoffoodCPIs,percapitacrop,foodexportsandimportgrowthfornineselected(larger)economies.Averagefoodinflationoverthe30-yearperiodhasmostlysituatedneartothe2%inflationtargetsthatprevailsinmostcountriesthataredepictedintheFigure.TherangeofvariationhasbeenlargestinthecasesofAustraliaandSweden.Domesticcropgrowthhashoveredaroundzeroinpercapitaterms,withvariationbeinglargestinSpain.coefficientsofinterestinanymaterialway.Ascountry-specificfertilizerpriceindicesarenotavailable,themoreparsimoniousspecificationwithoutthiscomponentwaskeptasthebenchmarkmodel.8Thiscomprisescereals,liveanimals,fishandseafood,milkanddairyproducts,oilsandfats,fruitsandnuts,vegetables,sugaranddesserts,aswellasready-madefood.9VintageofApril2022.Figure1-GrowthandvolatilityFoodCPIinflation(%)averageandextremeobservationsvariability(standarddeviations)cropgrowthfoodinflationCropgrowth(%)averageandextremeobservations variability(standarddeviations)foodexportgrowthfoodimportgrowth3.BaselineEstimatesTableshowsthebaselineestimationresultsfortheJordà(2005)methodologyforyearst+1andt+2,withoutandwithatimetrend.Overall,themodelexplainsalargefractionofthevariationinFoodCPIinflation.Foroneyearaheadinflation,thewithinR2is0.61,indicatingthattheexplanatorypowercomesalsofromthetimeseriesdimension.10Thecoefficientsinthefirstfourrowsindicatethatbroadmacroeconomicconditionsdoimpactretailfoodinflationinaverysignificantway.First,foodpriceincreasesinoneyearpartlydospilloverintothefollowingyear,asindicatedbythepersistencecoefficientinthelaggeddependentvariable.Second,whenitcomestogeneralCPIinflation,thereappearstobesomemeanreversionwhichspillsoverontofoodprices.Yet,mostnotably,retailfoodpricesareclearlyaffectedbyoverallinflationexpectations.Further,theoutputgapmeasureforthebroadereconomydoestranslateinto1-yearforwardinflation,withacoefficient(0.12)thatiscomparableinmagnitudetothoseobtainedfortheaggregateCPI(seee.g.StockandWatson(2019)andHazellet10Withoutthelaggeddependentvariable,thewithinR2isstill0.59,withcoefficientsforothervariablesthatarequalitativelysimilar.Thisindicatesthatthehighexplanatorypowerofthemodeldoesnotcomefromthelaggeddependentvariable.al(2022)).Together,theseresultssuggestthatretailfoodinflationisnotindependentofcoreeconomicdevelopments.Onthecontrary,ithingesonvariablesthatareaffectedbymonetarypolicy.11Table1?BaselineEstimationResultsDependentvariable:FoodCPI?1and2yearforwardlaggeddep.var.CPIinflationexpectedinflationoutputgapdomesticcropgrowthfoodexportsgrowthfoodimportsgrowthoilpricechangeglobalfoodpriceinflation(FAO)timetrend1yearforward2yearforward-0.05650.06270.10610.06950.04990.0421-0.01530.0159-0.00160.0147-0.02730.01650.0076***0.0025-0.00970.01461yearforward0.0403-0.2317***0.07440.10470.0441-0.0471***0.01120.0295**0.0115-0.01110.01550.0132***0.00230.01310.0004***0.00012yearforward0.2226***0.0462-0.3015***0.08131.0865***0.09710.0475-0.0471***0.01150.0300**0.0119-0.01510.01600.0131***0.00230.0131-0.07540.05940.10190.07000.05380.0417-0.01400.0158-0.00160.0143-0.02610.01640.0079***0.0025-0.01000.01420.0003*0.0002observations2numberofcountriescountryfixedeffectsyesyesyesyesR2between.961.924.967.940R2within.6060.340.614.343RMSE0190.024019024Note:Explanatoryvariablesatyeart,anddependentvariablesinyeart+1andt+2.Allvariablesinlogchanges.Estimatedonyearlydata.Cluster-robuststandarderrorsareshownbelowcoefficients.***/**/*denotestatisticalsignificanceat1/5/10%confidencelevel.11Notethatthisdoesnotimplythatcentralbanksshouldtargetaninflationmeasurethatincludesfoodinflation.Evenaftertheeffectofmonetarypolicy,foodinflationisstillmorevolatilethanheadlineinflation.Targetingamorestablemeasureofinflationisdesirableinmanyinstances.Further,thecoefficientsinthenextthreerowsshowthatdomesticcropsandinternationalfoodtradeimpingeonfollowingyears’retailfoodprices.Thecoefficientissuchthata10%cropincreasehastheeffectofreducingnextyears’foodpricebyabout47basispoints.Thecentralestimatesindicatethatfoodimportsgrowthhaveasomewhatsmallereffect,whichisnotstatisticallysignificant,attestingtoatbestpartialsubstitutabilitybetweenownandimportedproduction.Bycontrast,a10%increaseinfoodexports,boostsretailfoodpricesbyonly0.30percentagepoints(withp-values<0.05).Thesmaller(absolute)magnitudeofthelatereffectislikelyduetotheimperfectsubstitutabilitybetweenfoodexports,whichtendtobeconcentratedonahandfulofproducts,andthetypicaldomesticfoodconsumptionbasket.theeffectofglobalcommoditypricesondomesticretailfoodpricesisfoundtobeverymodest.Particularlyoilpricechanges,haveverysmallquantitativeeffectsonretailfoodinflation.Inturn,thepass-throughofglobalfoodprices,asmeasuresbytheFAOfoodpriceindex,isverypartial,withacoefficientofonly0.11withinayear.Thiscanberationalizedbythehighsegmentationinthefoodmarket,particularlyforquicklyperishableproducts.Finally,thetimetrend,whenincludedattainsasignificantpositivesignindicatingrisingnominalpricesovertime,allelseequal.Primafacie,thiswouldappeartogocountertothePrebisch-Singerhypothesisoffallingcommoditypricesasincomesrise(seee.g.Arezkietal(2016)andBaffesetal(2016)).Thatsaid,thecoefficientisalmostnegligible:itwouldtakearound25yearsforittoleadtoaonepercentagepointincreaseinfoodprices,ceterisparibus.Asarobustnesscheck,theestimationswererepeatedusingDriscoll-Kraay(1998)standarderrors,thatfactorineventualcross-countrydependence.Theresults,whichareshowninTableA5,indicatethattheconclusionsarebarelyaffectedbythischangeinestimationmethod.4.ResultsbyCountryGroupingsGoingfurther,resultsbyincomelevelarecompared.Forthis,thecountrieslistedinAppendixTableA2,weregroupedinto(relatively)higherandlowerincomecountries.HigherincomecountriesarethosewhosenominalGDPpercapitaattheendofthesampleperiodexceeded$30.000,accordingtoInternationalMonetaryFundstatistics.Theremainingcountriesweregroupedasrelativelylowerincomecountries.Thecut-offlevelof$30.000correspondstothecurrentpercapitaincomelevelsofSloveniaandSpain(whicharethusincludedintherelativelyhigherincomegroup).Notethatasthemajorityofcountriesinthefullsamplearerelativelywelloff(allbeingOECDmembers),thelowerincomegrouphasasmallernumberofobservations.Thistendstoincreasetheuncertaintyaroundthemagnitudeofthecoefficientsinthisgroup.Table2?ResultsbyCountryIncomeLevelDependentvariable:FoodCPI?1and2yearforwardhigherincomecountries 1yearforward2yearforwardlowerincomecountries 1yearforward2yearforwardlaggeddep.var.0.1947***0.054-0.02240.0550.1869**0.079-0.2664**0.11560.12470.04170.0503-0.0511***0.01380.0552**0.01970.00140.01500.0172***0.00520.01290.138-0.03530.17300.0850-0.01380.0586-0.03300.03580.01240.0230-0.02900.02270.00140.0049-0.01190.0274CPIinflationexpectedinflationoutputgapdomesticcropgrowthfoodexportsgrowthfoodimportsgrowthoilpricechangeglobalfoodpriceinflation(FAO)-0.3890***0.12260.8122***0.14520.2345***0.0625-0.0475***0.01430.01770.0131-0.03470.02430.0099***0.00270.0776***0.0149-0.3923***0.13310.8896***0.12460.0520-0.00880.0138-0.00810.0178-0.01450.01830.0102***0.00250.00320.0159observationsnumberofcountriescountryfixedeffectsyesyesyesyesR2between.703.344.977.938R2within.3970.205.765.450RMSE0170.019022033Note:Explanatoryvariablesatyeart,anddependentvariablesinyeart+1andt+2.Allvariablesinlogchanges.Estimatedonyearlydata.Cluster-robuststandarderrorsareshownbelowcoefficients.***/**/*denotestatisticalsignificanceat1/5/10%confidencelevel.TheestimatesshowninTable2highlightthatthepositiveeffectoftheoutputgaponfoodCPIinflationisstrongerandstatisticallysignificantinthehigherincomegroup.12Italsolastslonger,reachingnotonlyone-yearaheadfoodinflation,butalsothetwo-yearaheadinflation.Further,ifanythingtheeffectsofinternationalfoodtradeonthefoodCPIarestrongerinthelowerincomegroup.Inthisgroup,thelinktoglobalfoodpricesisalsoslightlymorevisible,evenifitremainsmodest(i.e.pass-throughof0.16withinayear).Hereitisimportanttonotethat,ingeneral,amodestcoefficientfortheoutputgapvariablecanitselfbeanaturalresultofasuccessfulinflationcontrolpolicy,whichfirmlyanchorsinflationexpectationsarounditstarget.Suchfirmeranchoring,willnaturallyleadtopricesreactinglesstooutputdislocationsthanwouldbethecaseinaregimewherepriceexpectationsareunanchored(seeStockandWatson(2019)formoreonthismechanism).Second,asafurtherdissectionofthedata,thesampleoftheprevioussectionisdividedaccordingtoeconomicrelevanceoftheagriculturalsectorintherespectivecountries.Namely,countriesinwhichthesampleaverageweightoftheagriculturalsectorinGDPisabovetheoverallsamplemeanforthatvariablearelabelledascountrieswithamorerelevantagriculturalsector.TheestimationresultsinTable3showthatthesensitivityofpricestofoodtradeissomewhatlargerincountrieswheretheweightoftheagriculturalsectorisabovethemedian.Third,thesampleissplitintocountrieswherethedependenceonfoodimportsisbelowandabovethemedian.EstimationresultsinTable4showsthatthesensitivityoffoodpricestotradeislargerinthegroupofcountriesthatrelymoreheavilyonimports.12Averageinflationinthehigherincomecountriesoverthesampleperiodwas2.0%,whilethatinthelowerincomegroupwas4.8%.Table3?ResultsbySizeofAgriculturalSectorDependentvariable:FoodCPI?1and2yearforwardcountrieswithmorerelevantagriculturalsector 1yearforward2yearforwardcountrieswithlessrelevantagriculturalsector 1yearforward2yearforwardlaggeddep.var.0.06090.09240.2498***0.0562-0.3441**0.13840.9037***0.18200.0451-0.0475***0.01180.00180.0135-0.01560.02480.0117***0.00340.0716***0.0202-0.00900.0724-0.4292***0.13901.3670***0.26750.0632-0.03310.0195-0.00830.0175-0.02900.02010.0057*0.0030-0.00740.0193CPIinflationexpectedinflationoutputgapdomesticcropgrowthfoodexportsgrowthfoodimportsgrowthoilpricechangeglobalfoodpriceinflation(FAO)0.10041.0542***0.10490.0608-0.0599***0.01590.0370**0.0174-0.01080.02120.0139***0.00340.01720.10090.12520.06910.06400.0522-0.00500.02400.02310.0183-0.0371*0.02070.00590.0043-0.03440.0216observations427410numberofcountriescountryfixedeffectsyesyesyesyesR2between.965.923.708.465R2within.6800.427.375.237RMSE0220.029015017Note:Explanatoryvariablesatyeart,anddependentvariablesinyeart+1andt+2.Allvariablesinlogchanges.Estimatedonyearlydata.Cluster-robuststandarderrorsareshownbelowcoefficients.***/**/*denotestatisticalsignificanceat1/5/10%confidencelevel.Table4?ResultsbyRelevanceofFoodImportsDependentvariable:FoodCPI?1and2yearforwardcountrieswherefoodimportsarelessrelevant1yearforward2yearforwardcountrieswherefood importsaremorerelevant 1yearforward2yearforwardlaggeddep.var.0.0530.0930.324***0.052-0.355***0.0540.0590450.059-0.050***0.0100.026**0.009-0.046*0.0240.012***0.0020.079***0.0210.104-0.1490.1550.042.0690.044-0.0010.018.0180.019-0.0340.0210.006*0.003-0.0080.021CPIinflationexpectedinflationoutputgapdomesticcropgrowthfoodexportsgrowthfoodimportsgrowthoilpricechangeglobalfoodpriceinflation(FAO)-0.2030.159.033***0.2080.051-0.061***0.018.0240.022.0060.0210.014***0.0040.0170.2161.204***0.167.0540.083-0.0160.024-0.0020.022-0.0370.024.0060.004-0.045*0.023observations42710numberofcountriescountryfixedeffectsyesyesyesyesR2between.945901975.935R2within.528326.712.438SE.0222615.022Note:Explanatoryvariablesatyeart,anddependentvariablesinyeart+1andt+2.Allvariablesinlogchanges.Estimatedonyearlydata.Cluster-robuststandarderrorsareshownbelowcoefficients.***/**/*denotestatisticalsignificanceat1/5/10%confidencelevel.5.ResultsbyQuantilesandwithWinsorizedVariablesTofurtherassesstherobustnessofthebaselineresults,thesensitivityofretailpricestothedifferentexplanatoryfactorswascheckedfordifferentlevelsoffoodpriceincreases.Forthis,thequantileregressionapproachwasused,followingKoenkerandBassett(1978),KoenkerandHallock(2001)andKoenker(2005).Themainadvantageofthismethodoversamplepartitioning,isthatherethefullsetofobservationsisusedintheestimationofcoefficientsforeachquantile.Thisaidsmorepreciseestimation.Standarderrorswereobtainedbybootstrapping,with1,000replications.Byandlarge,thepatternsthatwerereportedbeforeholdforthe10th,30th,50th,70thand90thregressionquantiles?ascanbeattestedbytherespectivecoe