PRICE CHANGES OF BASIC NEEDS ON THE POVERTY LEVEL

Poverty is often identified in developing countries. One measure propertyis the ability to fulfill basic needs particulary food needs. On the other hand, food needs are very sensitive to changes in inflation. The more fluctuating inflation ll'i/1 change the prices ofnecessities, 1rhich then exacerbate
poverty conditions. Using time-series datafor the period 2005-2016 and using the Ordinmy Least Square method, this study examines the impact of changes in the prices of necessities on poverty levels in North Sumatra. The results shOII'ed that the increase in rice prices, sugm; cooking oil, beef. and salt had an impact on the poverty level in North Sumatra. ll'hile the increase in the price
of eggs and kerosene was the opposite. The increase in rice prices significantly impacted all of the commodities studied than .for other commodities, .followed by salt, sugar; beef. and cooking oil. Changes in the ability to consume basic needs indicate a decrease in people's purchasing power
Further, this indicates that the change in consumption of these various commodities also means that the poverty rate tends to increase.