In products, price rise could occur (Demand-pull
In economics, the price rise is known as inflation.
Inflation is knownto occur when there is a sustained increase in the price of the goods availablein the market (Öner, 2017). And inflation is measured annually. In other words,with every unit of a currency – say Ringgit – the goods that we could purchase decrease.The rise in food prices could be a result of various factors. First, increasein the cost of production (Cost-pull Inflation), probably because all theagricultural production system is dependent on oil and the rise in the oil prices results in the rise of food prices (Hall and Lieberman, 2010). Second, with the increase in demand of foodproducts, price rise could occur (Demand-pull Inflation), probably as a result of production shortage or unequaldistribution of food products (Hall and Lieberman, 2010). Whatever are thereason for the food shortage and price rise, the repercussions are notpositive.
However, the price rise is only an inconvenience to thepeople in the developed world, while in the developing or the under-developedcountries rises in food prices could leadto chaos and conflict (Brown, 2009). Relationship between food and socialdiscontent I believe that there is astrong relationship between social discontent and food shortages. Socialdiscontent means not being satisfied with the current state of affairs andhighlighting the same in the form of peaceful protests or even violent civilunrest.
This is because food is a basichuman need. It is the responsibility of the government to provide for its citizen’s basic food supplies at an affordablecost based on their living standards. Food is essential for human survival andthe lack of food can make a man do anything. As the Canadian economist, Jeff Rubin puts it, “Nothing sends aperson into the street quite like an empty stomach” (Rubin, 2012, p.
73). If welook at the history, it was hunger that served as a catalyst in many of therevolutions. Two examples come to my mind: the French revolution and the ArabSpring. During the course of the French revolution, one of the most significantevents was the women’s march to the palace of Versailles, in which the womenfrom the market of Paris marched to the palace as a sign of protest against thehigh food prices and the scarcity of bread. Similarly, 2010 was a rough yearfor the global food system as the wildfires in Russia burned away 25 percent ofthe harvest prompting Kremlin to stopinternational exports while the whole of NorthAfrica was dependent on it (Frazer and Rimas, 2011). Hunger along with otherproblems served as a catalyst again in the revolution which eventually threwthe region into chaos (Fraser and Rimas,2011; Rubin, 2012). HUNGERAS A CAUSE OF CONFLICTWe are living in an erawhere is there is food shortage within a region’spopulation with many people going hungry yet there are others who stillenjoy adequate access to food (Messer and DeRose, 1998).
With misguidedeconomic development policies in developing countries, and the internationalmarket, which results in a pattern of hunger and chaos from selectivemarketing, and from non-market political policies of food extraction orassistance (Messer, 2009). This coupled with rising inflation, we have millionsof people who cannot afford to feed themselves. They lack access to adequatefood, which may exist in the marketplace, and this frustration can lead todesperation and violence (Messer and DeRose, 1998; Messer, 2009).I have, in this essay,taken examples from a few examples to highlight this phenomenon. India It is quite peculiar thatIndia is in the list of countries in which there is social discontent among itspeople because of food. The reason I believe it to be peculiar is that India, within two decades, was able to become an export economy from an import economythanks to the green revolution in India which significantly increased the yieldper acre. After becoming self-sufficient, it became a major exporter of foodgrains in the early 21st century. When the global food prices hit anall-time high in 2008, the Indiangovernment decided to generate revenue from the exports which were morelucrative than sales in the domestic market (Chand, 2010).
And we see that theglobal exports of domestic produce increasedfrom 6.2% during 2003-04 to 2005-06 to more than 10% during 2006-07 to 2008-09(Chand, 2010). This caused even the domestic prices to rise, despite Indiabeing self-sufficient during the economiccrises of 2008. A large portion of the countries population belonging to themiddle-income group was not in a positionto raise its expenditure on food to neutralize the effect of food inflation inthe country. This caused unrest and discontent among the people. Just before the economiccrises hit the world in 2008, riots took place in the region of Bengal in 2007because of unequal distribution of food grains (Majumdar, 2007). In India,there is a public distribution system known as ration shops, which distributesfood grains and other essentials to the public at prices fixed by thegovernment, intended for the poorest sections of the society.
However, theofficials in-charge for the distribution of food supplies saw the skyrocketing global food prices and sold thepublic food supplies in private market for higher gains. A report by thesupreme court of India highlighted that 34.9% of rice and 86.6% of wheat meantfor the distribution at the ration shops was sold in the private market by theofficials (Sethi, 2007). In the case of India, thecivil unrest was a result of not the production but rather the distributionpolicy of food grains.
Venezuela Venezuela was once the richest country inLatin America, and it has the largest known oil reserve in the world. Itsdemocratic government was once praised worldwide. But today Venezuela’sdemocratic institutions and economy are in shambles. The country has thehighest inflation rate in the world, with over 700 percent, making food andmedicines inaccessible to most Venezuelans. Over the last four years, its GDPhas fallen by over 35 percent which is a sharper drop than the one seen during the great depression in the US (Martin,2017). These conditions have sparked protests and riots against the presidentNicholas Maduro, and it is easy to see why. The food prices in thecountry have skyrocketed because of the hyperinflation causing people not onlyto riot but also to scavenge for food in the streets.
The monthly minimum wage inMay 2017 was at 200,000 bolivars while the price of the basic groceries hasbeen at five times the monthly minimum wages i.e. 1 million bolivars(Benzaquen, 2017). These conditions haveforced the people onto the streets. The crime rate has gone up, increasedmalnutrition, poverty, diseases and mortality rate. Since the protest,according to one estimate, 90 people have died, and 3600 people have beenarrested by the government (Benzaquen, 2017).
Venezuela dependedheavily on oil exports and imported all its food supplies. But when the oilprices plummeted in 2014, the government decided to stop the imports and payoff their debts. And a series of other ill-fated policy decisions which onlybenefited the cronies of Nicholas Maduro, resulted in food becoming scarce in the once rich country (Benzaquen,2017). African continent and the Middle EastThe case of many of thecountries in the African continent and the middle eastern countries that aretorn apart by war is quite different from that of India or Venezuela. In these countries, food insecurity is caused by aseries of draughts coupled with armed conflict within these countries, and the fallof the macroeconomic structures.
A report on the global food crises waspublished by Food Security Information Network (FSIN) in collaboration with theEuropean Union (EU), World Food Programme (WFP), and Food and AgriculturalOrganization (FAO) of the UN for the countries to act upon in theirhumanitarian and resilience response in March 2017. The report identifies four countries inparticular that are at risk of famine, who need immediate internationalassistance. These four countries are Yemen, North Nigeria, South Sudan andSomalia which each have 17 million, 10.9 million, 4.
9 million, and 2.9 millionpeople respectively that are on the brink of starvation and death (FSIN, 2017).
