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A theory is appropriate as long as it fits into the fact; when a theory doesn't fit in the fact, it's wise to walk with the fact.

Tuesday, May 31, 2011

Views on Commodity Prices

Sohel Parvez from the Daily Star nicely compiled observations of the mass as well as experts on the current phase of higher commodity prices in Bangladesh. Interesting to read! Here are the two links:


1. Inflation: the seen and unseen effects
2. How to ease inflationary pressures


My comments:
Economists mentioned measures including generating employment opportunities for the unemployed, widening safety net programs, and storing food as much as possible for possible market intervention, if necessary. To me, these are all good measures for the low income peoples. What about the measures for middle income and/or fixed income groups of the population?

Surprisingly, everyone talked about short-run measures to tackle inflationary pressures, didn’t mention any long-term solutions such as investment in agriculture infrastructure (and/or agriculture research). How long we are going to live on short-term measures based on government subsidy? 

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