26-Dec-2011

FDI in Multi-Brand Retail Will Hurt Farmers


A prominent TV channel featured the story of a few farmers in Punjab highlighting how direct purchases of produce by a retailer had given them a higher yield. This is a type of faulty reasoning described in college textbooks as “the fallacy of composition”. The fallacy of composition arises when one infers that something is true of the whole from the fact that it is true of some part of the whole.
The channel had obviously hand-picked a few farmers who suited its conclusion. The only way to assess the impact on farmers is to look at countries where big retailers dominate the market, and see how the entire farming community has fared.
And it has fared quite badly.  Take a look at the following picture and then read the whole analysis for the numbers.

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