Abstract: In the current time, food price inflation is inevitable due to the fact that the many countries in the world have globalised and liberalised their economy. The economies in the world now are very much integrated as compared to previous centuries. Any supply or demand fluctuations in major commodity producing countries will influence the global price of the commodities including food prices. Rapid rise of population and growing economies have also put a lot strain on food production and supply hence driving up the food price. The free market principles are not perfect since there is no such thing a perfect market in the world and many countries in the world are not a closed market since majority of the countries are trading economies. Hence, measures like subsidy have to be taken to address market imperfections and unequal wealth distributions. Specifically to food subsidy, food price ceilings and food coupons are one of the common ways to mitigate the impact of the rising food inflation. This paper will begin the topic by discussing the social impacts of poverty and food inflation to a country and the importance of mitigating it. Then, this paper will attempt to discuss the role of food price ceilings and food coupons in mitigating the impact of food price inflation. The advantages and disadvantages of both systems will be discussed. Finally, the paper will conclude that between these two options, food coupon is a better subsidy than food price ceiling approach.
Keywords: Price ceiling, food coupon, subsidy, infaltion.
Title: The Role of Food Price Ceilings versus Food Price Coupons in Mitigating the Impact of Food Price Inflation
Author: Mohamad Haidir Hashim, Ruslan Sabirzyanov
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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