PETALING JAYA: It is unreasonable to expect the low-income group to stop buying items to curb price hikes, an economist said today, saying the solution was “too easy”.
This was after economic affairs minister Rafizi Ramli advised consumers to avoid buying unreasonably priced items to curb inflation.
Former Economic Action Council executive director Noor Azlan Ghazali said such a move was wrong, and would not produce the desired result.
“From an economic perspective, bringing down demand to curb rising costs is too simplistic.
“It gives the impression that it is among the measures to arrest rising costs. In extreme cases, will ensuring there is no demand be an effective way to curb a price hike? It is not the way,” he said in a Facebook post.
Noor Azlan said a price hike is likely caused by a lack of supply, noting that during the festive season, demand was stable and there was no surge in prices.
He went on to cite the increased price of eggs, which he said was likely caused by suppliers.
Noor Azlan said it was either caused by a cut in production or items being shipped off to more profitable markets.
He said in this instance, chicken and eggs are without any alternatives, so forcing people to not buy them was impossible.
“Low-income groups don’t have many options. From an economic standpoint, Rafizi’s call is too easy. Economic logic is very important in dealing with these problems,” Noor Azlan said.
He added that the parties concerned should always practice caution when proposing solutions to economic problems.
Noor Azlan proposed a study of the spending habits among the low-income group to draw up sound economic solutions.
At a press conference yesterday, Rafizi was reported to have said that consumers were partly to blame for the increase in the price of food.
He said if consumers stopped purchasing unreasonably priced items, sellers and suppliers would not increase the prices at their whims and fancies.