EXPLORING THE LINK BETWEEN FINANCIAL INCLUSION AND FOOD SECURITY IN ALGERIA: A VECM Approach

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CHETOUANE Hania
Epo Boniface Ngah
CHETOUANE Sonia

Abstract

This study explores the link between financial inclusion and food security in Algeria from 2003 to 2022. Using a composite financial inclusion index and the Vector Error Correction Model (VECM), we analyse the data, subjecting it to various diagnostic tests. Surprisingly, our results reveal that financial inclusion (FI) has a significant and positive impact on undernourishment prevalence, indicating a negative effect on food security in both the short and long term. Likewise, food imports (FIM) contribute to higher undernourishment prevalence, implying a weakening of food security in the long-run. Conversely, unemployment rate (UEM) and food production (FOP) show no substantial long-term impact on food security, although UEM has an opposing effect in the short run, meaning it improves food security at the short term; which can be attributed to the informal economy and other State’s policies. Notably, income per capita (INCAPITA) negatively affects undernourishment prevalence, improving food security. These findings offer a nuanced understanding of the complex relationship between financial inclusion and food security in Algeria, emphasizing the need for multifaceted, context-specific policies to address the country's unique challenges.

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How to Cite
CHETOUANE Hania, Epo Boniface Ngah, & CHETOUANE Sonia. (2024). EXPLORING THE LINK BETWEEN FINANCIAL INCLUSION AND FOOD SECURITY IN ALGERIA: A VECM Approach. IJEP, 7(01), Pages: 257–280. Retrieved from https://ijep.dz/index.php/IJEP/article/view/318
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Author Biographies

CHETOUANE Hania, Pan-African University (Cameroon)

phd student

Epo Boniface Ngah, University of Yaoundé II, Soa, Yaoundé ( Cameroon)

teacher researcher

CHETOUANE Sonia, University of Jijel (Algeria)

teacher lecturer