scholarly journals Three essays on agricultural policy and food demand

2015 ◽  
Author(s):  
◽  
Jing Zhao
Keyword(s):  
Food Consumption ◽  
Rural China ◽  
Meat Consumption ◽  
Fixed Effect Model ◽  
Food Demand ◽  
Wheat Market ◽  
Expenditure Share ◽  
The Future ◽  
Negative Effect ◽  
Food Expenditure

To understand better the effect of policy and technology on agricultural markets, I study three topics about agricultural policy and food demand in this dissertation. My first essay identifies the worldwide historical pattern of wheat support and predicts the future trend of wheat support. Based on the theory of political economy, it is proposed that the income level is one factor that determines agricultural support. To provide the empirical evidence to substantiate this theory, I test the relationship between wheat support and income by building a fixed effect model with the historical data of 55 countries from 1961 to 2011. Besides income, several other factors are also considered, including three dummies for food spikes, trade status, per capita arable land area, agricultural population rate, and a shift variable that serves as a proxy for Uruguay Round Agreement Act implementation. The results indicate that there are statistically significant effects of income, income square, and income cubed on wheat support. In addition, I project that the future wheat support levels of China and India, especially border market support, might continue to rise with income growth. Meanwhile, Japan might maintain its high level of wheat support into the future. In the second essay, I examine the effect of government stock policies on the outcomes of China wheat market. Since 2006, the Chinese government used strategic reserve and marketing auctions to influence wheat market outcomes. Yet relatively little is known about how these policies affect wheat market prices in China. I develop and use a structural economic model to conduct a counterfactual analysis in this study. I evaluate the wheat market effects of government marketing activities during the period 2006/07 to 2013/14. I also perform sensitivity analysis to estimate the impacts of alternative displacement degrees between government stocks and private stocks, domestic area response, corn prices changes, and alternative price elasticities of stock demand. The results indicate that the government stock policies stabilized wheat market prices, if measured by the standard deviation of annual prices, and raised the wheat production in China over the year 2006-2013. In the third essay, I assess the effects of new technology adoption on food consumption. I test the effect of refrigerator ownership on food consumption in rural China during the period when the refrigerator ownership in rural China increased from 14% in 2001 to 45% in 2010. I use two methods to develop models and perform empirical tests. First, I estimate two-way fixed effect model based on single-equation demand function that explains consumption using own price, cross prices, and household characteristics. The results show that refrigerator ownership had a statistically significant and negative effect on meat consumption quantities. Annual meat consumption per capita would decrease 1 kilogram with 1% increase in refrigerator ownership rate. Second, I develop a demand system model, and link refrigerator ownership to food expenditure in an auxiliary equation. The results indicate that refrigerator ownership has a statistically significant and negative effect on total food expenditure, while it has a statistically significant and positive effect on the expenditure share of meat, egg, seafood, and negative effect on grain and fruit. Moreover, without considering refrigerator, the price and income elasticities of different food might be overestimated or underestimated. Taking meat for example, the income elasticity might be overestimated without considering refrigerator, which might lead to higher meat demand projection in the future with income growth. Therefore, I conclude that refrigerator ownership might reduce total food expenditure and meat consumption quantity, and that refrigerators may change food consumption pattern, by increasing the expenditure share of meat, egg, seafood, and decreasing the food expenditure share of grain, fruits, that the future food demand projection in rural China might be biased without considering refrigerator ownership. To enumerate a few underlying reasons that could lead to these results, refrigerators might help reduce the food losses or waste by changing the way people store food, the frequency with which people buy food, and the food mix people consume. This study might provide evidence on some of the benefits and costs of subsidizing the purchases of refrigerators in the developing countries.

scholarly journals Analysis Food Demand of Java Households with Aids Model Estimates

2022 ◽  
Vol 27 (1) ◽  
pp. 96
Author(s):  
Roeskani Sinaga ◽  
Manuntun Paruliah Hutagaol ◽  
Sri Hartoyo ◽  
R Nunung Nuryartono
Keyword(s):  
Price Elasticity ◽  
Household Income ◽  
Food Prices ◽  
Food Demand ◽  
Household Expenditure ◽  
Household Food ◽  
Expenditure Share ◽  
Food Expenditure ◽  
Expenditure Elasticity ◽  
Food Commodities

<p>The quantity and quality of food consumed by the community are determined by the price level and household income. Household food expenditure share is still dominated by rice commodities. The aims of this study are 1) to analyze the level of household expenditure on food in Java and (2) to analyze the expenditure elasticity and price elasticity of household food demand in Java. The data used was March 2015, 2016, and 2017 SUSENAS data. Household consumption data was estimated using the AIDS Model. The results showed that household food expenditure share for medium and low-income groups (Q3 and Q4) for urban and rural areas was more than 50 percent. This shows that the household is food insecure. The own-price elasticity for all commodities is negative and inelastic. Changes in food prices do not significantly affect changes in demand for food commodities because their elasticity is inelastic. Household food demand is more influenced by food prices than household income for food commodities except for rice commodities. Rice has elastic expenditure elasticity (means that food demand is very responsive to changes in household expenditure/income. The relationship between each commodity is almost entirely negative (complementary).</p>

scholarly journals The Future of Indonesian Food Consumption

2019 ◽  
Vol 8 (1) ◽  
pp. 71-102
Author(s):  
Bustanul Arifin ◽  
Noer Azam Achsani ◽  
Drajat Martianto ◽  
Linda Karlina Sari ◽  
Ahmad Heri Firdaus
Keyword(s):  
Food Consumption ◽  
Functional Relationship ◽  
Development Planning ◽  
Food Demand ◽  
Demand Model ◽  
Medium Term ◽  
Productivity Improvement ◽  
The Future ◽  
Price Trends ◽  
The Relationship

This study aims to develop a model of the future of Indonesia’s food consumption up to 2045, using a baseline of food consumption in 2017 and projections to 2025 as milestones, and to draw policy relevance on food and related issues for the next Medium-Term Development Planning of 2020–2024. The projected demand of Indonesian food consumption is built based on the functional relationship between income and food consumption at the baseline using three different scenarios of economic growth: baseline, moderate, and optimistic. Method of Almost Ideal Demand System (AIDS) was implemented to estimate changes of food consumption. Susenas data from 2017 is used as the baseline of food demand model. Susenas data from 1990–2016 is used to analyze selected food consumption trends and the relationship between food consumption, price trends, and income in all 33 provinces of Indonesia. The results show that future food demand in Indonesia is determined by existing demand, income, price and its composition, and various other factors that affect the behavior and trends of consumption. The policy should focus on the balance between demand-side management and supply-side or productivity improvement, as the majority of food production centers are located in Java.

scholarly journals Inequality and Welfare by Food Expenditure Components.

2009 ◽  
Vol 48 (4II) ◽  
pp. 755-768 ◽  
Author(s):  
Rashida Haq ◽  
Nabeela Arshid
Keyword(s):  
Food Consumption ◽  
Rural Areas ◽  
Concentration Index ◽  
Jel Classification ◽  
Total Expenditure ◽  
Consumption Expenditure ◽  
Food Components ◽  
Negative Effect ◽  
Food Expenditure ◽  
Urban And Rural Areas

This paper examines inequality and welfare in food consumption expenditure in Pakistan. The indices are derived on the basis of Sen’s welfare function by employing HIES, 2005-06. The empirical results show that inequality and welfare varied widely in urban and rural areas. It can be seen that the concentration index of non essential/luxury food components are unevenly distributed over the total expenditure in favour of rich families. The price elasticity of welfare indicates that rising prices of food components have negative effect on the aggregate welfare. The present analysis provides a basis for determining the magnitude of inequality and welfare that can help in designing appropriate policies. JEL classification: D12, D13, D31, I31 Keywords: Food Consumption, Inequality, Welfare, Elasticity

scholarly journals ANALISIS POLA KONSUMSI RUMAH TANGGA PETANI JAGUNG DI KABUPATEN GROBOGAN

Agric ◽  
2017 ◽  
Vol 28 (1) ◽  
pp. 41
Author(s):  
Fajar Prasetyoningrum ◽  
Endang Siti Rahayu ◽  
Sri Marwanti
Keyword(s):  
Food Consumption ◽  
Educational Level ◽  
Household Income ◽  
Positive Influence ◽  
Central Java ◽  
Food Expenditures ◽  
Negative Effect ◽  
Food Expenditure ◽  
Household Members ◽  
Positive Effect

<p>ABSTRACT</p><p>This study aims to analyze the broad influence corn field to the household income of corn farmers in Grobogan district, analyze the effect of educational level the head of family to the household income of corn farmers in Grobogan district, analyze the effect of the number of family members to the household income of corn farmers in Grobogan district, analyze the effect the food and non food expenditure to the household income of corn farmers in Grobogan district. Locations were taken intentionally, in Grobogan district, because Grobogan district has the widest corn harvested area in the province of Central Java. Total population that taken in this study is 150 household of corn farmers who scattered in several regions in Grobogan. The sample is a fraction of the number and characteristics which is owned by the population. Samples were corn farmers, the number of samples taken is 60 corn farmers in Grobogan. The results showed that land area of corn gave positive effect on household income of corn farmers in Grobogan, the educational level of husband’s household insignificant, the number of household members has a positive influence on the level of household income, food expenditure had a negative but not significant to household income and non-food expenditures have a significant negative effect on the level of household income. The result of the calculation of the proportion of food consumption and the proportion of non-food consumption showed that the average total expenditure for average food expenditure per farmer per month amounted Rp. 1.023.611,00 while the non-food expenditure amounted Rp. 2.619.552,00.</p>

Engel curve, farmer welfare and food consumption in 40 years of rural China

2018 ◽  
Vol 10 (1) ◽  
pp. 65-77 ◽  
Author(s):  
Xiaohua Yu
Keyword(s):  
Food Consumption ◽  
Economic Reform ◽  
Rural China ◽  
Food Prices ◽  
Food Demand ◽  
Content Type ◽  
Engel Curve ◽  
Engel Curves ◽  
Income Elasticities ◽  
Welfare Change

Purpose The purpose of this paper is to review the theoretical background, methodological extensions, and empirical applications of the Engel curve, which is applied to the research of the change in farmers’ welfare and food demand in China after the economic reform in 1978, compared with the statistics of income and food consumption. Design/methodology/approach This paper mainly uses the traditional method of Engel curve, which is compared with income growth and food consumption, to study farmers’ welfare improvement in rural China. Findings The Engel coefficients identify three different stages for farmers’ welfare change after 1978. The first stage is the period between 1978 and 1988, in which farmers’ welfare has been continuously enhanced due to the institutional bonus of the 1978 economic reform and increased government purchase price of agricultural products. The second stage is the period between 1989 and 1995, in which farmers’ welfare has been slightly deteriorated mainly due to the end of institutional reform bonus, suppressed food prices, relative high inflation, and instable political situation. The third stage is the period after 1995, in which farmers’ welfare returns to a growing path, as the dual price system was abolished, the transition from a planned economy to a market economy had been completed, and the government carried out protective policies for agriculture and started to heavily subsidize agriculture. The Engel coefficient still remained at a very high level at 0.59 in 1995, but it continuously decreased to 0.33 in 2015. The welfare enhancement for farmers mainly results from deepened market-oriented reform, protective policies for agriculture, and prevalent off-farm employment. The Engel coefficient is also linked to food demand elasticities. Along with the decreasing Engel coefficient in the past 40 years, income elasticities also continuously decrease from 0.55 in 1978 to 0.08 in 2015. Food demand is very inelastic now, and any further increase in income will not substantially increase food demand any more. Research limitations/implications Inequality has not been analyzed. Originality/value This paper reviews the methodological advantages of the Engel curves, and uses it to identify different stages of welfare change and estimate income elasticities of food demand for farmers in China after the 1978 economic reform.

Food consumption among income classes and its response to changes in income distribution in rural China

2018 ◽  
Vol 10 (3) ◽  
pp. 406-424 ◽  
Author(s):  
Yanjun Ren ◽  
Yanjie Zhang ◽  
Jens-Peter Loy ◽  
Thomas Glauben
Keyword(s):  
Income Distribution ◽  
Food Consumption ◽  
Rural China ◽  
Distribution Patterns ◽  
Food Demand ◽  
Food Groups ◽  
Demand Model ◽  
Two Stage ◽  
Content Type ◽  
Income Elasticities

Purpose Given the fact that the income disparity has become extremely severe in rural China, the purpose of this paper is to examine heterogeneity in food consumption among various income classes and to investigate the impact of changes in income distribution patterns on food demand in rural China. Design/methodology/approach In this study, the authors partition the households into five income classes according to the distribution of household per capita net income. Using household data drawn from the China Health and Nutrition Survey in 2011, a two-stage demand model is applied to estimate a food demand system for each of the income classes. After obtaining the estimated income elasticities of eight studied food groups for each income class, the authors then examine the responsiveness of food demand to the changes in income distribution by means of four scenarios with varying income distribution. Findings The empirical results indicate that substantial differences in food consumption exist across various income classes. Specifically, the lowest-income households are more sensitive to price and income changes for most studied food groups than the highest-income households are. In general, income responsiveness is higher for meats, aquatic products and dairy products. Based on estimated income elasticities, the projected food consumption under different income distribution patterns shows that changes in income distribution have significant influences on food consumption. In addition, the authors conclude that a more equal distribution of income would be associated with a higher demand for food in rural China. Originality/value This paper employs a two-stage demand model to estimate food demand in rural China by income classes. The results imply substantial differences in food demand for various income classes. Therefore, income distribution should be taken into account instead of an average estimation for the population as a whole when investigating food demand in rural China. Given the significant changes in income distribution in rural China, this study provides several important policy implications to alleviate income inequality and poverty, as well as to improve nutrition for lower-income classes.

Household food demand in Pakistan: A provincial analysis

2018 ◽  
Vol 2 (1) ◽  
pp. 1-18
Author(s):  
Sajjad ◽  
Zahoor Ul Haq ◽  
Javed Iqbal
Keyword(s):  
Food Consumption ◽  
Wheat Flour ◽  
Fruits And Vegetables ◽  
Food Demand ◽  
Living Standard ◽  
Food Groups ◽  
Cooking Oil ◽  
Food Expenditure ◽  
Economic Survey ◽  
Essential Food

In developing countries of the world, the pattern of food consumption is usually used as a benchmark for measuring the living standard of people. This paper examines and compares the food expenditure pattern of households across provinces in Pakistan using 2011-12 household integrated economic survey(HIES) data. The study used the linear approximate almost ideal demand system (LA-AIDS) to estimate food demand elasticities. The patterns of food consumption and expenditure for eight food groups: wheat flour, rice, dairy, pulses, meats, fruits and vegetables, cooking oil and other foods are examined. The study observed differences in household consumption patterns across provinces. The estimated results show that all food groups have negative own price elasticities and are consistent with economic theory. All the expenditure elasticities are positive and significant indicating that all food groups are normal. The expenditure elasticities estimated show that dairy and meats are luxury foods in all provinces, while wheat flour, pulses, cooking oil, and other foods are necessities in the diet of the Pakistani households. In all provinces, a household spends most of its food expenditure on dairy products, wheat flour, cooking oil, fruit and vegetables. The estimates suggest that policymakers in Pakistan should ensure and monitor the availability of these essential food items in order to reduce undernourishment and food insecurity in the country.

Financial Constraints, Stock Returns and R&D in Indian Stock Market

2021 ◽  
pp. 097226292098839
Author(s):  
Pankaj Sinha ◽  
Priya Sawaliya
Keyword(s):  
Stock Market ◽  
Stock Returns ◽  
Financial Constraints ◽  
Fixed Effect Model ◽  
Quantitative Information ◽  
Common Shocks ◽  
External Finance ◽  
Negative Effect ◽  
Security Returns ◽  
Indian Stock Market

When the accessibility of external finance prohibits a firm from taking the optimum decision related to investment, that firm is called financially constrained. By applying the methodology of Kaplan and Zingales (1997) and Lamont et al. (2001), the current study has created a construct to gauge the level of financial constraints (FC) of the companies which emanate from quantitative information. The study explores whether FC factor is present in the Indian stock market and explores whether the security returns of those firms that are financially constrained move in tandem. The study also attempts to establish the association between security returns and R&D of financially constrained firms. On a sample of 63 R&D reporting companies of S&P BSE 500, traded over the period March 2008 to February 2019, the study used the Fama–French methodology, fixed effect model and the ordered logistic regression. The study finds that firms that are highly constrained earn more returns than low constrained firms. Second, the security returns of firms that are financially constrained move in tandem because these firms are affected by common shocks. This suggests that the FC factor exists in the Indian stock market. Finally, when R&D interacts with the level of FC, then this interaction effect has a negative effect on returns.

scholarly journals Household food demand in rural China

2007 ◽  
Vol 39 (3) ◽  
pp. 373-380 ◽  
Author(s):  
Baichen Jiang ◽  
John Davis
Keyword(s):  
Rural China ◽  
Food Demand ◽  
Household Food
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