| This thesis surveys the impact of financial speculation on food prices, based on analysis of the available economic data from two recent, significant global food price spikes, between 2007--2008, and between 2010--2011. Most scholarly research and official policy recommendations focus on the market fundamentals of supply and demand. However, this thesis presents evidence that the financialization of the commodity market in general has opened up new ways for financial institutions to penetrate speculative markets, from which they continue to reap financial benefits today. The financialization of the commodity market was made possible when powerful private interests entered the political realm and utilized existing institutions to lobby for policies that would provide high returns to their shareholders. The result of these policy changes has been high and volatile global food prices, as well as negative pass-through effects. Thus, the major burden of recent food price increases has been on the already vulnerable people in developing countries. Additionally, this study of the development of the agricultural commodity market provides deeper insight into the transformation of the broader global food system and the concentration of power within that system. Unfortunately, corrective countermeasures are, at this point, limited. |
