Seeker Blog

Harvard economist and 1998 Nobel Laureate Amartya Sen offered useful comments on the food crisis. The impact on such as the rural poor in China, India, Vietnam who are not experiencing fast-rising incomes has not been much discussed. I.e., the national policies of these countries could solve most of their problem.

The ethanol impact is noted — but not that of the EU biofuel mandates. I’m not sure which has a bigger impact — both are bad policy.

…It is a tale of two peoples. In one version of the story, a country with a lot of poor people suddenly experiences fast economic expansion, but only half of the people share in the new prosperity. The favored ones spend a lot of their new income on food, and unless supply expands very quickly, prices shoot up. The rest of the poor now face higher food prices but no greater income, and begin to starve. Tragedies like this happen repeatedly in the world.

…Much discussion is rightly devoted to the division between haves and have-nots in the global economy, but the world’s poor are themselves divided between those who are experiencing high growth and those who are not. The rapid economic expansion in countries like China, India and Vietnam tends to sharply increase the demand for food. This is, of course, an excellent thing in itself, and if these countries could manage to reduce their unequal internal sharing of growth, even those left behind there would eat much better.