There are various global markets providing third world countries with necessities such as food and hygiene care products. These markets are the center for resources for areas in poverty. These areas are prone to high inflation rates, and therefore, setting prices and controlling costs are important to the industry.
Market prices have a great impact on poor countries, especially to avoid hunger. Poor households spend about 60-80% of their income on food. They will be scraping everything they have just to be fed. With an increase in food prices, they will have even less to spend on other necessities, such as clothes, medicine and books.
Over the years, prices within these markets have increased and about 44 million people and counting have fallen into poverty as a result of these higher prices. Prices are influenced by expanding populations, reliance on food crops and shifting food prices. Increasing prices are threatening poor people around the world.
Because of the increase, the impact of market prices has caused poor countries to restrict advancements to people’s households. Food price-related riots have taken place in a few countries, as the demand for affordable food and supply increases.
Along with food and supply, education seems non-essential as well. While market prices increase, more of a poor household’s income decreases, leaving less money going into children’s education. Children may have to work as a farmer or merchant to earn a few coins for the family.
With the effects most visible in poor countries, often, businesses will alter their products, influence government negotiations and predict the pricing. These alterations will minimize the effects of price control.
The impact of market prices is crucial. It is a factor in determining survival for households in poor countries. Market prices may determine whether a family will be able to afford to eat, or even save farmers with replaceable food when their crops are demolished by drought. The impact of market prices is what drives the economy of many countries. Whether there is an increase or decrease in its prices, there is an immediate reaction in the countries themselves, especially those in poverty.
– Brandi Gomez