Income Inequality In The Food Industry Essay

Financial actors within the food industry have substantially increased within the past decades, due to the food industry being seen as a higher-return investment opportunity. Financialization is emerging within the food industry as financial actors are holding increasingly important and active roles (Burch and Lawrence, 2009). It is these financial flows, which could be perceived to contribute towards the food crisis e.g. over accumulation of capital. Furthermore, Clapp reinforces the increasing importance of financial actors and argues that as these actors pour more finance into the industry food prices begin to rise (Clapp, 2012). Empirical evidence provided in Figure 2 shows the fluctuations and rises of food prices. Moreover, supporting evidence reinforces how prices of foods increased significantly e.g. wheat prices rose by 136% (World Resource Institute, 2008). Volatility in prices cause price spikes generating crisis as financial actors may remove finance from the industry in order to obtain higher profits hence manifestation of uneven development. It …show more content…
The reduction of trade ultimately reduced economic growth hence developing countries once again being categories as losers within the complex relationship. However, as food prices rose in the global food spike income inequality began to deepen. Income inequality is an indicator of uneven development. Income inequality became present, as wages for supermarket employers remained stagnated during this period (Palley, 2007). Those of the lowest income groups in developed countries would be most significantly affected. It is evident that losers are present globally within the food industry due the dependency of the industry. Losers have been illustrated through the dependency on aid, loss of trade and income inequalities tied to food