The supply-demand imbalance for eggs in the US is likely to be transitory for the reasons cited (“America’s grocers start rationing eggs after culls to tackle avian flu push prices higher”, Report, February 15; and “Eggflation teaches a valuable lesson about must-have goods”, Lex, February 15).
The prospects for longer-term price moderation for chocolate are more ominous (“Cocoa stockpiles plunge to record low amid Valentine’s Day chocolate surge”, Report, February 15).
Recognising the likely enduring high price of many staple but non-necessity foods and drinks exhibiting low price elasticity of demand such as chocolate, coffee, crisps and other snacks (aka “junk food”), perhaps we can deploy the “constant expenditure rule”, an offshoot of the price elasticity concept. This states that consumers reduce their quantitative consumption of goods by the same percentage rise in the price of the goods, keeping their total expenditure constant.
Over time this would mitigate consumers’ inflation-related stress and likely improve their health profiles!
Ira Sohn
Emeritus Professor of Economics and Finance
Montclair State University, Upper Montclair, NJ, US