For a rural coffee grower in Colombia, rising global coffee prices should be nothing but good news. Grow more beans, make more money. So Grant Miller, a health economist at Stanford University, was surprised to discover what else higher prices herald: Sicker kids. It turns out that “child mortality rates go up when prices go up,” says Miller. The opposite is also true: Child mortality decreases—fewer infants and children die—when prices slump.
Miller and his coauthor examined average annual coffee prices from 1970 to 2006. Three events during that time led to huge price shocks: Brazil’s crop-devastating frost in 1975 and drought in 1985 increased the price of coffee dramatically; the collapse of the International Coffee Agreement in 1989-90 decreased it. They compared these sudden price changes to indicators of child health and mortality such as immunization records, prenatal care, population size, and acute disease to come up with their counterintuitive conclusion that a better economy can be hazardous to children’s health.
“Things that are important for your health are often not expensive, but take a lot of time,” Miller explains. Competition for time is much stronger when coffee prices are high, as the value of tending to the household coffee plot goes up. Breastfeeding, kitchen hygiene, and securing clean drinking water can be very time intensive. So can access to primary health services in rural Colombia, which are cheap but may be over the mountain and have a days-long wait. “If you’re a coffee grower, you can earn more money in a high-price year by working harder on your coffee plot. But that comes at the cost of other things that you’re spending your time on less, including taking care ofyour kids,” says Miller.
Does this mean fair trade initiatives, which aim to lift farmers out of poverty, are having some serious unintended consequences? Not necessarily, says economist Christopher Ruhm of the University of North Carolina at Greensboro, who finds similar effects on health in the United States and western Europe. “We’re talking about pretty shortterm changes in income. If coffee prices were permanently higher, you might see a quite different response,” Ruhm says. “My prediction would be that things that make your life more secure, more stable—like longer-term increases in incomes—would be very good for health.”
Broad development objectives may not be the fastest way to fight disease in emerging economies like Colombia, however, because “money is not the principal obstacle to people doing things that are good for their health,” Miller says. “Measures that improve access to health technologies and services are much more likely to have important immediate effects than a focus on general economic development.” Since “being healthy is not necessarily about being wealthy, poor but healthy is a feasible state of the world.”
Grant Miller and B. Piedad Urdinola, “Cyclicality, Mortality, and the Value of Time: The Case of Coffee Price Fluctuations and Child Survival in Colombia,” Journal of Political Economy, 118, 2010.
Read more stories by Jessica Ruvinsky.