The rise in food prices and its effect on Arab society in Israel

In 2021, a wave of inflation began to wash over the world, which means a sharp and comprehensive increase in prices in wide areas. Inflation was also felt well in Israel and was widely expressed in the public debate about the cost of living and in economic policy.

At the same time, the preoccupation with the differential effects of inflation – on its various components – has received less attention, and there is room to expand the discussion regarding how the increase in prices affects diverse population groups. This report focuses on the increase in food prices in Israel and their effect on the Arab population. As part of this work, an analysis of the main food components in the index was conducted
Consumer prices, distinguishing between Arab settlements and Jewish cities in Israel.

The analysis presented below shows that in Arab settlements in the Triangle and the Galilee, the prices of many food and beverage products are higher and the variety of products is limited, compared to the Jewish cities. This phenomenon mainly characterizes products that are mostly produced at the national level or imported from abroad, while the prices of food products that are produced locally and more distributed (such as fresh vegetables and fruits),
lower in Arab settlements.

In addition to this, the findings of the report indicate that global inflation did not pass over the Arab localities, which experienced price increases similar to other localities in Israel. The increase in the price of food products imposes a heavier burden on Arab society, because the weight of food in the consumption basket of an Arab household is considerably higher than its weight in the consumption basket of a Jewish household.

In conclusion, the increase in food prices in 2021 increased an Arab household by 1250 NIS compared to about 900 NIS for a Jewish household. The strengthening of inflation since then continues to make it difficult for households and increase the disparity between Arabs and Jews.

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