Table of Contents
Introduction
As one of today’s most prevalent issues, the implications of food insecurity on their own are daunting and terrible, not to mention the massive economic issues that come with food insecurity. Typically, people are recommended to consume at least 2,200 kilocalories every day, although many people consume 3,000 kilocalories or more; however, estimates suggest that while we produce enough food to feed the entire human population, over 850 million people are living on diets much lower than the recommended amount. In the end, it all boils down to there being an uneven distribution of food, this in turn is caused by a variety of issues, with the most important one being the widespread poverty in the world today.
Other causes of food insecurity include the increasing human population and the increasing use of biofuels. Despite many attempts to decrease food insecurity, especially following the economic recession around 2007, food insecurity rates have continued to increase in recent years. Food insecurity itself has vast, long-lasting and significant impacts on individuals, society and economies as a whole. For individuals and families, food insecurity has a devastating impact on the development of children, people’s general health, and almost all aspects of their lives.
Apart from being immoral and unethical to allow such situations to continue, these impacts on people in turn heavily affect society and the economy. For example, in the United States, every year hungers costs the economy $461.9 billion in total expenditures, $221.9 billion in gross products and 2.5 million permanent jobs. Lifetime effects of food insecurity include almost $3.4 trillion in aggregate spending, $1.5 trillion in gross products and 15.9 million years of employment.
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Definition of Key Terms
Food Insecurity
The state of not having a reliable supply of affordable and nutritious food.
Food Price Volatility
Food prices, whether high or low, can be volatile. Volatile food prices mean that they are subject to rapid and unpredictable changes, thereby wreaking havoc on markets, politics and social stability.
Background Information
With food insecurity on the rise in recent years, addressing both the economic implications of food insecurity as well as the causes and effects on people is immensely important. Affecting over 850 million people in every country in the world, food insecurity is a constant reminder of the inequality of the world, expressed, in this case, as an unequal distribution of food supplies that are in fact sufficient to feed the entire world. Combating it and ensuring everyone has access to affordable and nutritious food is of the utmost importance.
Food Insecurity
Before addressing the economic implications of food insecurity, it is important to understand what causes it and the diverse ways in which it affects over 850 million people.
Causes
The obvious and most prevalent cause of food insecurity world is of course poverty. With 1.5 billion people living on less than $1 a day, their hardships are unimaginable. With such low levels of income not only is food hard to purchase, but people lack the capital to invest in agriculture. The world’s growing population is another major reason behind the increasing levels of food insecurity since, as the world population will increase by around 2 billion by 2050, there will be a significantly larger strain on our food supplies. Finally, an emerging and rapidly growing cause of food insecurity is biofuels, which are alternative and ‘greener’ fuel sources that are based on organic substances such as corn. This is turn limits the amount of food available for consumption.
Impacts on People
Food insecurity has a massive impact on families and individuals. Food insecurity is a major source of stress and anxiety in households struggling to put food on the table, and that’s without accounting for the many households with one or more family members with dietary restrictions or diseases like diabetes. Another major part of the impact of food insecurity on people is how around 60-70% of people suffering from food insecurity have had to choose between food and other essentials, such as medical care, utilities, transportation and housing. This in turn leads to families attempting coping strategies that may not always be beneficial or healthy. These include alcohol and drug use, watering down food or drinks, and consuming unhealthy food (e.g. fast food). People have also said that they end up asking for and receiving help from friends, selling or pawning personal property and attempting to grow food in their gardens.
Economic Implications
The economic implications of food insecurity are far-reaching and have a heavy impact on the economies of all societies, causing billions of dollars worth of total expenditures and gross products, as well as millions of jobs and hours of employment.
Food Price Volatility
As defined earlier, food price volatility means that food prices are subject to rapid and unpredictable changes. This is because in the food market the supply and demand curves are extremely inelastic, essentially meaning that the supply and demand of food remains the same since people need the same amount of food – since food is not a luxury or optional item in life – and that therefore changes in price neither affect, nor are greatly affected by supply and demand. Basically what all this means is that food prices, and the supply and demand of food are more unrelated than they are with most other economic products. Therefore, the prices and supply of food is unpredictable and can rapidly change. Currently food prices are extremely volatile and it is predicted to remain that way. The food price volatility also makes farmers more vulnerable to poverty, due to a lack of confidence in investing in their farms, therefore leading to a lack of food and economic decline.
Economic Impact on the Economy
In addition to the lack of food, and economic decline brought on by food price volatility, food insecurity also often includes high food prices that worsen food insecurity. Although food insecurity has major short-term negative impacts, it does have a positive long-term impact as it encourages outside investment in the agricultural sector. Investment is one of the most important factors in sustaining long-term food security, and therefore food insecurity may eventually lead to food security, but the issue is that it will typically take too long. Another issue allowing food insecurity is that many governments tightly control their food markets, thereby preventing a global food market. Liberalizing the food markets and allowing a global food market to arise is a major step towards ensuring food security.
