I’ve been listening to the excellent Radio 4 series, Our Food Our Future, over the past two weeks. In episode one they interview Alan Swinbank, an economist from University of Reading, who argues that following the current spike, food prices will resume their general downward trend.
In support of his argument, he pulls out the increasingly tired chestnuts:
1. Higher prices drive innovation
2. Technology can achieve whatever advances are required in order to support continued growth
3. Don’t worry if we don’t know what the solution is yet: the next technology may be unforeseen
4. Liberalisation of trade will ensure most effective sharing of the resulting benefits
Here the economist is talking about food but he’s using the same arguments you often hear from his brethren about energy, particularly in the context of fossil fuels: the market will fix it. It seems to be the warm fluffy blanket that they wrap themselves up in at night. And you’ve got to admit, it’s a seductive fluffy blanket.
But I’m uneasy about economists’ faith in market magic. It seems inevitable that the worlds of compound growth and finite resources are doomed to collide sooner or later (read: sooner; or even: as we speak). Sure, as limited fossil fuels become even more costly, other technologies will become more attractive. But Adam Smith didn’t reckon on the sticking power of entrenched energy interests.
I think I might convert to Economicism. Do I get to wear a funny hat?
carbon limited 
Unfortunately, before the market gets round to fixing everything, I foresee much more agricultural intervention and command economics to prevent widespread starvation, especially as farmers either rush to plant the latest cash crop (thus inevitably bringing the price down- see coffee, bananas, chocolate and, this year, wheat) or biofuel crops.
PS- Sorry Case, Ive been away- hence no reply to your guest blog query. Pint?
Pint!