This paper examines the short- and long- term effects of increasing minimum wage rates for farm workers in South Africa on structural unemployment and rising food prices in the economy. The Pearson correlation model was used to establish association between variables. Analysis found a negative association (–0.651) between wage rate and employment of farm workers, while a positive (0.021) association was found to exist between wage rate (W) increases and food prices (Fp). No association (0.001) was found between employment and food prices (Fp). Co-integration was further employed to determine the short-term and long-term relationships, and the analysis found wages to have a positive and significant (0.453) effect on structural unemployment of farm workers. Unemployment was observed to be wage elastic in the long term and wage inelastic in the short term. The long-term relationship showed increasing unemployment in agriculture (L) and rising food prices (Fp) (1.168), while the short-term relationship showed a signifi cant error correction coeffi cient (ECT) with an expected starting point of 41.9% adjustment rate towards long-term equilibrium within a year. Structural analysis confi rmed an inelastic demand for basic food. The study suggest government subsidies to farmers through cost-cutting technologies and farm worker’s skills development on the use of these technologies.
The presently faced uncontrolled and dramatic increase in food prices incites to rethink the question of food safety and measures addressing this global problem.
Poland's accession to the EU has accelerated the development the domestic food market. The market capacity, demand and supply increased. It did not result from growing consumption of food but from increasing degree of agricultural product processing as well as from growing share of food industry in satisfying the consumers' needs. The linkages between the domestic market and the EU and world markets have tightened. Since there is a general upward trend in food prices in the word, tightening linkages may bring up a demand barrier on Polish food market because of high prices.