Two dollars for an avocado, eight bucks for butter, four greenbacks for orange juice—food prices in the United States don’t always seem cheap. But compared to the rest of the world, we don’t know how good we have it.
Amidst the amber waves of grain and fruited plains, we spend less of our income on food than any other country. In a seemingly twisted world order, poorer countries spend a much higher percentage of their income on food products than wealthier countries, which enjoy a relative cheap and abundant supply. And although much of the world still suffers from malnutrition and food insecurity, an overabundance now threatens our health, though not our pocketbook.
Eating, By the Numbers
According to the Economic Research Service, a branch of the United States Department of Agriculture, the United States has it easy—we spent only 5.7 percent of our total household expenditures on food in 2007. In comparison, people in the UK spent 8.6 percent on food, residents of Denmark spent 10.7 percent, and in Hong Kong, China, residents used 12.5 percent of their income for food.
In fact, most wealthy countries use a small percentage of their household expenditures on food and top the list of rankings. Those countries that spend the most on food compared to other items are countries where consumers have less disposable income and most of their money goes to the bare necessities. Food shortages and higher relative food prices also account for a greater percentage of money spent on eating. In Jordan, for instance, they spend a whopping 40.9 percent of their money on food; in Indonesia it’s 45.7 percent, and in Azerbaijan, they use the greatest proportion of money on grub—50.4 percent.
The Real Cost of Cheap Food
It hasn’t always been this way. For Americans, food prices as a percentage of our disposable income has been dropping for decades. In the 30s, we spent around 21 percent of our disposable income on food; in the 50s, it was 17 percent, and on down, hovering around 6 percent for the past decade or so.
Why has food become relatively cheap? One of the main reasons has been improved efficiency in agriculture. For instance, corn yields in the U.S. averaged less than thirty bushels/acre prior to the 1930s. But with the introduction of hybrid seeds around 1935, the intensified use of fertilizer and herbicide (in 1972, nitrogen fertilizer was added to 96 percent of corn acreage), insecticides, and genetically-modified seeds, by 2008 the average corn yield reached 155 bushels/acre and doesn’t seem to be slowing down.
