77. The conclusion of this letter is that consumers are not truly benefiting from
advances in agricultural technology. The author concedes that, on the average,
consumers are spending a decreasing proportion of their income on food. But the author
contends that this would happen without advances in agricultural technology. The
author reasons that demand for food does not rise in proportion with real income, so as
real income rises, consumers will spend a decreasing portion of their income on food.
This argument turns on a number of dubious1 assumptions.
First of all, while asserting that real incomes are rising, the author provides no
evidence to support this assertion; moreover, it might be false. Even if salaries and
wages go up, this fact may not indicate that real income has increased proportionally.
Real income takes into account any effect inflation might have or, the relative value of
the dollar. It is possible that, when salaries and wages are adjusted for inflation, what
appear to be increases in real income are actually decreases.
In addition, the author assumes that increases in real income explain why, on the
average, consumers are now spending a decreasing proportion of their income on food.
But no evidence is provided to show that this explanation is correct. Moreover, the
author fails to consider and rule out other factors that might account for proportional
decreases in spending or food.
Finally, the entire argument turns on the assumption that benefits to consumers
from advances in agricultural technology are all economic onesspecifically, ones
reflected in food prices. The author ignores other likely benefits of agricultural
technology that affect food prices only indirectly2 or not at all. Such likely benefits
include increased quality of food as it reaches the market and greater availability of
basic food items. Moreover, the author cannot adequately assess the benefits of
agricultural technology solely3 on the basis of current food prices because those prices
are a function of more than just the technology that brings the food to market.
In conclusion, this letter has provided little support for the claim that consumers
are not really benefiting from advances in agricultural technology. A stronger argument
would account for the benefits of technology other than the current price of food, and
would account for other factors that affect food prices. To better evaluate the argument,
we would need more information about whether real incomes are actually rising and
whether this alone explains why consumers now spend a proportionately smaller
amount of income on food.
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