Boom or Bust: How commodity price volatility impedes poverty reduction, and what to do about it

This report examines how commodity price volatility affects commodity-dependent countries and producers, arguing that unpredictable incomes hinder fiscal planning, economic stability, and poverty reduction. It evaluates five types of economic tools for income predictability and provides seven guidelines for policy-makers to implement more coherent and successful responses.

• Commodity price volatility creates significant challenges for 95 developing countries that earn at least half of their export revenues from commodities, as prices can fluctuate by 50 per cent within a single year, complicating fiscal planning.
• The core issue is not price volatility itself, but the resulting volatility of individual and national incomes, which leads to environmental degradation, increased inequality, commodity dependence, and the obstruction of long-term planning.
• The report identifies five categories of economic tools to help producers achieve predictable incomes: supply management, national revenue management, market-based price risk management, compensatory finance, and alternative trade initiatives.
• The analysis concludes that no single policy can solve all aspects of commodity price volatility, and that stabilization interventions may cause market distortions or moral hazards. Additionally, poor infrastructure and limited access to knowledge remain persistent supply-side constraints.

APA

Gibson,, A. C. B. (2008). Boom or Bust: How commodity price volatility impedes poverty reduction, and what to do about it. International Institute for Sustainable Development. https://www.iisd.org/publications/report/commodity-price-poverty-reduction

Chicago

Gibson,, Alec Crawford,Oli Brown,Jason. Boom or Bust: How commodity price volatility impedes poverty reduction, and what to do about it. International Institute for Sustainable Development, 2008. https://www.iisd.org/publications/report/commodity-price-poverty-reduction.

Wikipedia

{{cite report |last1=Gibson, |first1=Alec Crawford,Oli Brown,Jason |title=Boom or Bust: How commodity price volatility impedes poverty reduction, and what to do about it |publisher=International Institute for Sustainable Development |date=8 January 2008 |url=https://www.iisd.org/publications/report/commodity-price-poverty-reduction |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{gibson2008boom, author = {Gibson,, Alec Crawford,Oli Brown,Jason}, title = {{Boom or Bust: How commodity price volatility impedes poverty reduction, and what to do about it}}, institution = {International Institute for Sustainable Development}, year = {2008}, month = jan, url = {https://www.iisd.org/publications/report/commodity-price-poverty-reduction}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }