Betting on the future of food: A quantitative model of food prices
Conference Year
January 2019
Abstract
An estimated 821 million people worldwide are facing chronic food deprivation, while the population dependent on global markets for staple foods continues to increase annually. Markets allocate food according to purchasing power, yet research has demonstrated that the most food insecure respond the most to increases in food prices. Deregulation of commodity markets since the early 1990s has greatly increased speculation, while climate change continues to worsen drought and extreme weather events. Existing quantitative price models reveal that speculation and corn ethanol demand most significantly predict price increases. I am currently conducting research with Dr. Joshua Farley concerning the effects of speculation on food prices and food security. Price demand elasticity has yet to be incorporated into food demand functions, along with the effects of speculation and demand for corn ethanol, to model the demand response of different income groups to price spikes and long-term price increases. I will present preliminary results of quantitative modeling of food commodity prices.
Primary Faculty Mentor Name
Joshua Farley
Status
Graduate
Student College
College of Agriculture and Life Sciences
Program/Major
Community Development and Applied Economics
Primary Research Category
Social Sciences
Betting on the future of food: A quantitative model of food prices
An estimated 821 million people worldwide are facing chronic food deprivation, while the population dependent on global markets for staple foods continues to increase annually. Markets allocate food according to purchasing power, yet research has demonstrated that the most food insecure respond the most to increases in food prices. Deregulation of commodity markets since the early 1990s has greatly increased speculation, while climate change continues to worsen drought and extreme weather events. Existing quantitative price models reveal that speculation and corn ethanol demand most significantly predict price increases. I am currently conducting research with Dr. Joshua Farley concerning the effects of speculation on food prices and food security. Price demand elasticity has yet to be incorporated into food demand functions, along with the effects of speculation and demand for corn ethanol, to model the demand response of different income groups to price spikes and long-term price increases. I will present preliminary results of quantitative modeling of food commodity prices.