But there is an indirect impact to consider: while poor households may benefit on the expenditure side from a measure that reduces the domestic price of food, they could be harmed on the earnings side as sellers of unskilled labour if not also food, thereby making the net effect on their welfare uncertain. What is critical, therefore, is not only whether poor households are predominantly net buyers or net sellers of food, but also the extent to which their income derives from wages linked to the demand for labour on farms. Since around 70 per cent of the US$1/day poor in the world are rural, a significant proportion of households that are net buyers of food may still be made worse off by policies that lower rural wages via lowering the domestic price of farm outputs.