The Relationship between Development Level and Supply and Demand of Main Agricultural Products

The recent trends in primary food prices have been evaluated as a signifier of the potential threats to the world in terms of food shortages and hunger. The prices of primary agricultural products like wheat and rice have risen significantly in the essential producer countries. The recent price changes were partially attributed to production shortages, which, if true, are expected to constitute a critical problem for both the suppliers and demanders. The rising prices, in accor­dance with the food shortages, are expected to influence the developing countries and the poverty lines that are mostly determined by the food intake. Accordingly, a relationship between poverty and real food prices is suspected mainly for developing and the least-developed countries. With this in mind, this study investigates the relationship between development level, including the indication of income distribution, and the producer prices of rice and wheat. We ana­lyze the degree of relationship between the Gini coefficient, indicating the level of income distribution, and various production indicators such as producer prices and yields of rice and wheat. Analysis of the data reveals that it is not possible to infer a significant relationship between yield of rice or wheat and the level of national income distribution. When the rich and poor countries are discriminated according to the level of income distribution, it is understood that rising producer prices reduce the income inequality by less than one percent. We conclude that the relationship should be reviewed with respect to contemporary changes in prices and level of income distribution and aggregates of income distribution in order to make proper inferences.