Prices and Costs

Project Outline

To look for prices and costs in India, USA and any European countries for any periods during the past 300 to 500 years up to present. To get any information of this type like Daily wage levels, Cost of farm land, Rent Salaries of different types of people – e.g. government employees, Cost of education, college fees, Cost of a meal, Cost of a book, Cost of foodgrains

Research Info

PRICES AND COSTS IN INDIA, USA AND ANY EUROPEAN COUNTRY IN THE PAST 300 – 500 YEARS

AGRICULTURE – FARMING AND FARMERS:

Agriculture is a major sector in India, accounting for 38% of Gross Domestic Product (GDP) in 1980, and declining but still remaining a significant 27% in 2000. It also accounted for 62% of employment as recently as 1998, and since then there has been no major decline. Consequently, any significant growth in agriculture is viewed not only as a means of achieving food security but also as a strategy to fulfill the broader goal of poverty eradication. After all, in a country that has over 600 million farmers, sustainable agriculture is the only way to provide viable livelihoods for a substantial section of the population.

Nearly 15 years after the ushering in of economic liberalisation, rather than experiencing unprecedented growth, the agriculture sector is in the grip of a severe crisis. This is reflected in a significant deceleration of growth rates in agriculture, both in terms of gross product and output. Within the crop sector alone, the growth rate of agricultural output decelerated to just 2.37% per annum during the 1990s, compared to a growth rate of 3.5% during the 1980s. This was the lowest growth achieved during any period. It has now slumped even further, reaching an abysmal 1.5% in 2004-05.

The most striking aspect of the farming crisis in India is that its severity is directly proportionate to the degree of integration with international trade and global markets. It is now well recognised, even by the government, that Indian agriculture is facing a serious crisis. Over 40,000 farmers are estimated to have committed suicide since 1997. The reported incidents of farmer suicides represent just the tip of the iceberg called distress in the rural economy. For every case of reported farmer suicide, there are at least 100 farmers who have not committed suicide but who face similar or even worse economic conditions. However, the government, the media and many non-governmental organisations (NGOs), while constantly debating the tragedy of farmer suicides, do not engage with the larger issues of the disastrous predicament of the farm sector and/or the pain and suffering in rural areas. The most interesting aspect of the farming crisis, or farmer suicides, is that the severity of the crisis is directly proportionate to the degree of integration with international trade and global markets. Farmer suicides are happening mostly in the so-called ‘developed’ states of India -- Punjab, Maharashtra, Andhra Pradesh, Karnataka and Kerala. In these states, agriculture has become highly commercialised and hence vulnerable to volatilities in the international market. There has been no case of farmer suicide in the so-called ‘backward’ states of Uttar Pradesh, Bihar, Jharkhand, Orissa, West Bengal, and in the northeastern region.

The World Trade Organisation-driven (WTO) free trade regime in agriculture is widely regarded as the chief reason behind the widespread farming crisis and farmer suicides. As a result of the WTO, Indian farmers are unable to get remunerative prices for their agricultural produce in the export market. This is mainly due to the fact that global prices for most agricultural products are depressed.

Full article: http://www.infochangeindia.org/TD_article09.jsp

Farmers are entrepreneurs and their structural issues like farm credit, soaring costs of inputs and lack of water remain unaddressed.

Full article: http://www.rediff.com/money/2007/mar/27poor.htm

The United States Department of Agriculture (also called the Agriculture Department, or USDA) is a United States Federal Executive Department (or Cabinet Department). Its purpose is to develop and execute policy on farming, agriculture, and food. It aims to meet the needs of farmers and ranchers, promote agricultural trade and production, work to assure food safety, protect natural resources, foster rural communities and end hunger, in America and abroad.

Full article: http://en.wikipedia.org/wiki/United_States_Department_of_Agriculture

Agriculture is a major industry in the United States and the country is a net exporter of food. In 1870, half of the US population was employed in agriculture. As of 2006, less than 1% of the population is directly employed in agriculture.

In 2004, of the 145 million employed workers in the US, 834,000 of them held jobs as agricultural workers. 83% of these jobs were as farm workers. The median hourly income as of May 2004 was $7.70 for farmworkers planting, growing and harvesting crops, and $8.31 for farmworkers tending to animals.

U.S. agriculture has a high yield relative to other countries. The yield was (in 2004):

Corn for grain, average of 160.4 bushels harvested per acre (10.07 t/ha) Soybean for beans, average of 42.5 bushels harvested per acre (2.86 t/ha) Wheat, average of 43.2 bushels harvested per acre (2.91 t/ha, was 44.2 bu/ac or 2.97 t/ha in 2003)

Full article: http://en.wikipedia.org/wiki/Agriculture_in_the_United_States

Farmland from Iowa to Argentina is rising faster in price than apartments in Manhattan and London for the first time in 30 years. Average U.S. farm prices increased 15 percent in 2006, Agriculture Department data showed. The cost of buying corn farms in Argentina, the world's second-largest exporter of the grain, jumped 27 percent, according to a Buenos Aires industry newsletter, Márgenes Agropecuarios. U.S. farmland declined by 9.6 million acres, or 2.8 percent, in the two decades that ended in 2001, according to the most recent data available from the government. Jim Rogers, the hedge fund manager who predicted the start of the commodity rally in 1999, said global warming would hinder crops and advised purchasing farmland for at least a decade

Full article: http://web.archive.org/web/20070222060424/http://www.iht.com/articles/2007/02/19/bloomberg/bxland.php

In the UK there are approximately 300,000 active farms with an average size of around 57 hectares, much larger than the European average size of approximately 20 hectares. However the UK's high average size is swelled by the impact of Scotland where the average farm size is over 100 hectares. In England average size is around 50 hectares. For Wales and Northern Ireland, sizes are smaller at around 40 hectares.

Despite the relatively large number of farms in the UK, the majority of the agricultural area is farmed by a much smaller number of farmers. Some 41,000 farms (~14% of the total) are larger than 100 hectares and account for over 65% of the agricultural area.

In 2006 the UK farming workforce (full-time, part-time and casual) amounted to 184,000 persons. There were 152,000 full time farmers with a further 198,000 part-timer owners engaged in some capacity in the farm business. The total farming labour force of 534,000 in 2006 had been broadly stable over the previous five years but was down 80,000 on a decade earlier.

UK farming incomes are defined at the industry level by a measure known as Total Income from Farming (TIFF) and at the farm level by a measure known as Net Farm Income. Both measures have exhibited long term decline since the 1960's, reaching a low point in 2000 with average Net Farm Income at just £8700. Since then both measures have risen and for 2006 Net Farm Income has been calculated at £20,600. This compares with median annual earnings for full time employees throughout the UK of just over £22,000 for the year 2002/3

Full article: http://www.ukagriculture.com/uk_farming.cfm

FOOD:

Rice is a staple food in Asia and accounts for more than 40% of the calorie consumption of most Asians. Poor people spend a large proportion of their income for buying rice. The level of rice production and prices is thus an important factor in determining the progress that can be made in reducing poverty in Asia. Keeping the price of rice low and affordable to the poor is crucial to poverty reduction. Given this, the current sustained upward trend in rice price is a major cause for concern. The Green Revolution in Asia led to a rapid rise in rice yield and production. This contributed to poverty reduction directly through increased income of rice farmers and indirectly through a lower price of rice, which benefited poor consumers in both rural and urban areas. This long-term decline in rice price, however, seems to have come to an end in 2001, with the rice price taking a sustained upward turn over the past six years. The rice price continued to increase during 2007 and this upward trend seems unlikely to reverse anytime soon.

Full article: http://www.irri.org/publications/today/pdfs/7-1/36-37.pdf

Food Prices are increasing around the world. In 1974-2005 food prices on world markets fell by three-quarters in real terms.

That is why this year's price rise has been so extraordinary. Since the spring, wheat prices have doubled and almost every crop under the sun—maize, milk, oilseeds, you name it—is at or near a peak in nominal terms. The Economist's food-price index is higher today than at any time since it was created in 1845 (see chart). Even in real terms, prices have jumped by 75% since 2005. No doubt farmers will meet higher prices with investment and more production, but dearer food is likely to persist for years.

But the rise in prices is also the self-inflicted result of America's reckless ethanol subsidies. This year biofuels will take a third of America's (record) maize harvest. That affects food markets directly: fill up an SUV's fuel tank with ethanol and you have used enough maize to feed a person for a year. And it affects them indirectly, as farmers switch to maize from other crops. The 30m tonnes of extra maize going to ethanol this year amounts to half the fall in the world's overall grain stocks.

http://www.economist.com/opinion/displaystory.cfm?story_id=10252015

Note:

(1) Where oil and wine were consumed instead of butter and beer, 5.2 litres of olive oil were substituted for the butter and 68.25 litres of wine for the beer. 5.2 litres of olive oil yields 116 calories per day and no protein; 68.25 litres of wine gives 159 calories per day and no protein. In Strasbourg, the average prices 1745-54 were 7.545 grams of silver for olive oil and 0.965 grams of silver for wine.

(2) M BTU = millions of BTUs

(3) Prices are in grams of silver per unit. Prices are averages for Strasbourg in 1745-54. The total shown in the price column is the total cost of the basket at the prices shown.

Source: http://gpih.ucdavis.edu/files/Allen_et_al.pdf

MINIMUM WAGES:

In India, the minimum wage varies according to the state and to the sector of industry; state governments set a separate minimum wage for agricultural workers; some industries, such as the apparel and footwear industries, did not have a prescribed minimum wage in any of the states in which they operated.

In the UK, the wage level ranges from £3.30 an hour to £5.35 depending on the age of the employee (48 hours per week).

In the US, the federal minimum wage is US$5.85 per hour; states may also set a minimum, in which case the higher of the two is controlling.

Source: http://en.wikipedia.org/wiki/List_of_minimum_wages_by_country

Day wages

Sources:

North India: 1810, 1830 and 1871 Meerut (Atkinson Vol III, p. 303), 1850 and 1871 Banda (Atkinson Vol. I, p. 119).

Middle India: Kolaba (Campbell, Vol. XI, p. 106-107), labour 1876 Khandesh (Campbell, Vol. XII, p. 200-201).

South India: Ganjam District (Leman 1882). Ganjam is in the extreme Northeast of the Madras Presidency, almost at the same latitude as Bombay. However as Middle India is defined as the line going northeast from Bombay to Calcutta, Ganjam falls under South India.

Full article: http://www.iisg.nl/hpw/papers/vanleeuwen.pdf

EDUCATION:

Statistical abstract, crudely corrected for East and West Pakistan by taking the division in enrolment for 1947 and extrapolate it backwards.

UNESCO World Education Indicators

Source:

http://www.uis.unesco.org/statsen//statistics/indicators/i_pages/indic_2.htm

Full article: http://www.iisg.nl/hpw/papers/vanleeuwen.pdf

At present in the US, the education and literacy levels are:

Primary education (6-11 years) : 100%

Secondary education : 88%

Tertiary Education (20-24 years): 60%

Adult literacy : 91%

Article: http://www.populstat.info/Americas/usag.htm