SOUTH AFRICAN AGRICULTURE AND INFLATION PHENOMENA

J. A. Groenewald

Agrekon, 1985, vol. 24, issue 01

Abstract: From 1973 tot 1982 South Africa experienced double digit inflation, more rapid rises in food than general price levels and slower increases in agricultural producers' prices than for inputs and consumers' goods. Agriculture earns much of its revenue through exports. Demand-pull inflation probably didn't cause the sharp food price increases. Farmers contribute to demand-pull inflation through injudicious purchases of inputs. Input prices rise faster locally than overseas. This decreases competitive power on international markets. Tariff protection of inputs and monopolistic conditions are contributory factors. Agricultural profitability decreases, debts rise and risks increase. Eventually this will result in smaller supply and higher food prices. Monopolies reduce agriculture's bargaining power. The Marketing Act attempts to improve this. Some boards, however, become statutory monopolies and contribute to cost-push. Such actions and the monopolistic actions of some Co-ops are harmful. In general, monopolies warrant more attention.

Keywords: Agricultural and Food Policy; Financial Economics (search for similar items in EconPapers)
Date: 1985
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:agreko:267080

DOI: 10.22004/ag.econ.267080

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