Geopolitical Risk and Food Inflation

ABSTRACT This study investigates the complex relationship between geopolitical risk and food inflation, a critical issue for global food security. Using panel data from 177 countries from 2019 to 2021, the research employs a random effects estimation model to analyze the dynamic. The central aim is to ascertain if countries with higher geopolitical risk also experience greater food inflation. The analysis confirms a positive correlation, where increased country instability is associated with higher food inflation. The study also reveals a counterintuitive positive relationship between GDP per capita and food inflation, challenging common economic assumptions. These findings have significant implications for economic policy and international cooperation, highlighting the need for strategies to mitigate the impacts of geopolitical instability on food prices and bolster food security.