Crossing the governance threshold: how institutional quality forms the biofuel–food security nexus

Purpose This paper investigates whether a governance threshold exists in the biofuel production–food security nexus. Design/methodology/approach This paper employs panel threshold regression estimation technique to identify the threshold of governance using a sample of 99 countries for the period from 2012 to 2024. Findings Utilizing an advanced estimation technique of panel threshold regression, this paper identifies the threshold level of governance and determines whether biofuel production has a positive or negative impact on food security given the threshold value of governance. The results reveal that a single threshold value of governance exists in the biofuel production–food security nexus. Biofuel production has a detrimental effect on food security when governance is below the threshold, but this effect turns positive when governance is above the threshold. Additionally, this paper conducts a robustness check by splitting the sample into developed and developing countries, confirming that biofuel production improves food security with good governance. Research limitations/implications Thus, policymakers should focus on bolstering governance to the highest degree as a core strategy to improve food security alongside biofuel production, particularly in mitigating the adverse impact of biofuel production on food security. Originality/value Empirically, prior studies have examined the direct impact of governance on food security. This paper fills the gap by investigating the threshold effect of governance on food security, specifically within the biofuel–food security nexus.