[4]That such a wealthy country has a shortage of baby food symbolises how the world is dogged by scarcity. The head of the UN’s World Food Programme in May cautioned that hundreds of millions of people are “marching to starvation” in what could rank among the worst humanitarian disasters since World War II. Economic growth will be lower than otherwise and inflation higher because scarcity makes prices much more sensitive to demand. But the combination of reduced demand to subdue wages inflation, forgone production from supply shortages and hard-to-suppress supply-side inflation is stagflation. The age of scarcity will pass but not for a while and not before it has shaken the world.

Source: Washington Post June 17, 2022 12:31 UTC