Editorial: Prices and wages

The COVID-19 pandemic, beyond the public health crisis that it created, disrupted the supply chain internationally.

Ports were underfunctioning for a protracted period. Workers there were suspended, contracts were not executed, and therefore international transport was rocked by the pandemic.

The upset impacted on production as businesses in the first phase of the pandemic shock, in their effort to manage the repercussions of the decline of demand, reduced their output, which led to short-term supply problems.

As time went by and vaccine rollouts sped up, there was an effort to normalise production and international trade, but the accumulation of unexecuted orders increased demand in the transportation sector and freight charters.

In general, the cost of transport skyrocketed and that placed pressure on the prices of goods traded internationally.

That pressure, combined with many events attributed to climate change that were recorded over the last years in almost every area on the planet and took a toll, especially on food production, intensified inflationary pressures internationally.

Moreover, deflationary conditions lasted for nearly a decade in the global economy after the great financial crisis of 2008. That, for a protracted period, placed pressures on prices and wages and paved the way for a wage-price spiral.

It is no coincidence that distinguished economists acknowledge that a major problem over the last years has been the deepening of inequalities, which has resulted from the long, generalised depreciation of goods, services, and labour (especially unskilled).

The situation is different with investment capital - especially as regards new technologies - which is enjoying historically unprecedented profits,...