Last updated on February 8, 2011
I would love to take the time to discuss each of these items in detail, but Tuesdays are my big teaching day — I teach my section of the core undergraduate micro class for Public Policy Studies majors during lunch, and I teach my law and economics seminar after dinner — and yesterday was the day of the first prelim in my micro class. And today, I am moderating a panel on global agricultural markets at a conference at the Fuqua School of Business, so here goes:
- The Food and Agriculture Organization of the United Nations issued a warning that drought in China may considerably reduce the amount of wheat available on world markets. As Krugman notes, it’s not because China is largely autarkic (or self-sufficient) when it comes to wheat that this will not put pressure on the prices of other food staples. After all, various commodities are substitutes for or complements to one another, and prices rarely if ever change in a vacuum.
- Speaking of Krugman, I completely agree with him when he says that there is little to no evidence that speculation on food markets caused the current price spike. I am also a skeptic as to whether speculation and arbitrage will solve the world food problem given the transaction costs Krugman mentions. It could very well be, however, that speculation and arbitrage remains the best we can do to attenuate food price fluctuations.
- Center for Economic and Policy Research (a liberal, Washington, DC-based think-tank not to be confused with the academic London-based Center Centre for Economic Policy Research) co-director Dean Baker had an excellent, long post about how the Washington Post is systematically confused about the role of the Federal Reserve and its chairman, Ben Bernanke, in causing the food price spike, with thanks to my colleague Don Taylor for orienting me towards this post.
- Institute for Development Studies director Lawrence Haddad (whose paper with Alderman et al. I assign to students in my development seminar every fall semester) had a post on how to make agriculture more helpful in attaining better nutrition for people in developing countries.
- From Tom Paulson, an example of the causal claims I warned against in yesterday’s post on whether food prices caused Tunisia and Egypt.