Two hundred years ago, English political economist Thomas Malthus came up with a theory which suggested that population growth would lead to food shortages and social upheaval. Since then, the world’s population has increased from around 1 billion to around 6.6 billion, and the world’s food production has increased even more, so that there is still more than enough to feed everybody. But in the last year a global food crisis has been emerging. Wheat prices have gone up 120%. In just two months rice prices have increased by 75%. According to the International Monetary Fund, the reasons include:
- Higher demand for more and better food from increasingly wealthy people in China and India;
- Demand for biofuels is diverting crop production from food supply;
- Droughts and floods have reduced food supply;
- Competing land uses have reduced the land available for growing food;
- Food stockpiles have been run down, so there is a reduced capacity for dealing with shortages;
- Speculators have been hoarding supplies.
Shortages have led to famines and food riots in a number of countries, and Haiti’s government was toppled last weekend after riots over the prices of rice and beans. Does this mean that Malthusian times are now upon us? Probably not, but it’s difficult to respond in a way which solves the problems. The easy answer is to send free food to the affected countries, but that undercuts the livelihoods of local food producers, removing their incentive to plant crops, which in turn leads to an even deeper crisis in the following year.