Does the International Trade of Food Rob Developing Countries of Their Food Security?

Does international trade make all parties better off? That question has preoccupied economists since well before David Ricardo published his Principles of Political Economy and Taxation in 1817, which outlined a theory of comparative advantage still taught to economics students the world over. According to that theory, trade leaves no country worse off if countries choose to specialize in producing and exporting the goods for which they have the lowest opportunity cost out of all the goods they can produce. In other words, trade is not a zero-sum game, and in most cases trade makes both countries better off.

Although the theory of comparative advantage concludes that trade leaves no country worse off in the aggregate, international trade can generate winners and losers within a given country. It is perhaps for this reason that many people question the theory of comparative advantage and believe that international trade makes certain countries worse off. That belief is especially prevalent when the trade being discussed is that between developing and developed countries, or when the goods being traded are food commodities. Opinions are even stronger when the subject is food exports from developing to developed countries, prompting arguments in favor of food sovereignty.

Indeed, the Declaration of Nyéléni, which was adopted at the 2007 Forum for Food Sovereignty, states that

Food sovereignty … puts those who produce, distribute and consume food at the heart of food systems and policies rather than the demands of markets and corporations. … It offers a strategy to resist and dismantle the current corporate trade and food regime, and directions for food, farming, pastoral and fisheries systems determined by local producers. … Food sovereignty promotes transparent trade that guarantees just income to all peoples and the rights of consumers to control their food and nutrition. It ensures that the rights to use and manage our lands, territories, waters, seeds, livestock and biodiversity are in the hands of those of us who produce food.

Food sovereignty advocates therefore argue that food security – adequate nutrition for individuals, no matter the provenance of the food commodities consumed – is not enough. Rather, one of their goals is a greater role for local foods, which necessarily means a smaller role for the international trade of food.

But does the international trade of food really threaten food security? The answer appears to “No,” according to my most recent paper, coauthored with Frank Asche, Cathy Roheim, Marty Smith, and Sigbjørn Tveteras, and which was accepted last week for publication in World Development.

In this paper, which you can find here, we take a look at the international trade of fish and seafood (Frank, Cathy, Marty, and Sigbjørn are all economists who have done extensive work on fish and seafood) in order to answer the question posed in the title of this post. Here is the abstract:

Does international trade make all parties better off? We study the relationship between food security and the international trade of fish and seafood between developing and developed countries. Specifically, we look at and discuss the evolution of trade flows – values, quantities, and prices – between developing and developed countries. The picture that emerges suggests that the quantity of seafood exported from developing countries to developed countries is close to the quantity of seafood imported by developing countries from developed countries. What takes place is a quality exchange: developing countries export high-quality seafood in exchange for lower-quality seafood.

This paper is my second paper on the economics of fish and seafood. The previous one was a 2012 piece published in PLoS ONE in which we presented the FAO’s fish price index.