Differential price responses for tobacco consumption: implications for tax incidence

Increasing tobacco taxes is considered the most effective an cost-effective policy to reduce tobacco consumption. However, a common objection to tobacco taxes is that they tend to rely disproportionately on the poorest individuals since less affluent smokers incur proportionately greater expenditures on cigarettes compared with more affluent smokers. Such objections usually assume that all smokers throughout the income distribution react similarly to an increase in tobacco prices. But, if less affluent smokers are more sensitive to price changes (ie, they have a higher demand price elasticity), reductions in tobacco consumption should be higher at the bottom of the income distribution. This paper uses data from Argentina’s Household Expenditure Survey to estimate demand price elasticities for tobacco by income and age groups. Results indicate that less affluent smokers present higher demand price elasticities for cigarettes than more affluent ones. A 10% increase in cigarette prices would decrease consumption by 8.5% (4.4%) for the poorest (richest) smokers. In addition, young people are the most elastic group. These differential elasticities have relevant implications in terms of the distributional incidence of increasing tobacco taxes. As less well-off individuals reduce consumption relatively more, they bear a relatively lower tax burden. Thus, tobacco tax increases may not be regressive as is often believed. As a whole, this paper provides policymakers with relevant arguments for policy discussion and the public debate on common objections to increasing tobacco taxes.

Factors associated with household expenditure on oil and fat products in Malaysia: application of quantile regression

In today’s rapidly urbanising society, high-fat dietary behaviour is one of the main causes of obesity and various chronic diseases. The objective of the present study is to investigate factors associated with the consumption of oil and fat products among the Malaysian population. This research examined the oil and fat products expenditure patterns among 12798 households using the Malaysian Household Expenditure Survey (HES) 2014. Results were derived from the quantile estimation on cross-sectional data. Household heads’ sociodemographic and household characteristics are used as the explanatory variables. We found positive relationships between the quantiles of household expenditure on oil and fat products and age, educational level, and household size. In terms of marital and employment status, households with married or employed heads tend to spend more on all the quantiles of oil and fat products relative to households headed by single or unemployed individuals. Furthermore, the quantiles of expenditure were higher among urban households than rural households. The findings of the present study lend support to the fact that the quantiles of household expenditure on oil and fat products vary across household heads’ sociodemographic and household characteristics. The findings had important implications for how a nationwide intervention measure directed towards reducing dietary fat intake in the Malaysian population is formulated.

The carbon footprint of Brazilian households through the Consumer Expenditure Survey (POF)

The main objective of this article is to assess the carbon footprint of Brazilian families based on the Household Expenditure Survey (POF), 2008-2009, from the Brazilian Institute of Geography and Statistics (IBGE). The methodology used to quantify the Brazilian households’ carbon footprint has comprised three data sources: i) Household expenditure Survey, 2008-2009; ii) Leontief matrix of Brazilian accounts, year 2010; and iii) 2009 World Input-Output Database (WIOD) environmental inventory. Initially, an input-output (IO) model was created. Next, the results from the IO model were combined with the information of the POF. The poorest families, with a monthly income of up to $ 415.00, emit less than 1.5 metric tons per year, in contrast, the wealthiest families, with a monthly income above $ 5,187.50, release around 18.5 tons, almost 12 times more. It was found that an increase in income, results in an increase in CO2eq emissions. Thus, while the poorest families, which represent more than 20% of the total Brazilian families, cause 7% of the total emissions, the wealthiest families cause 16% of the total emissions although they represent only 4% of the total families. It was observed that the food category loses importance as income increases, while the opposite occurs in the services category. For the poorest families, there is great importance in the housing category, mostly caused by the consumption of electricity and LPG. Therefore, important measures for economic growth supported by actions become particularly relevant.

Decomposing Inequality in Household Consumption Expenditure in Malaysia

This study aims to examine the sources and determinants of consumption expenditure inequality in Malaysia as well as to quantify their proportional contributions to the total explained inequality using the Household Expenditure Survey (HES) data for the year 2014 collected from the Malaysian Department of Statistics (DOSM). The study applies Field’s regression-based decomposition method to the log-linear regression model of per capita monthly consumption expenditure. It is found that the model explains about 55.2% of the variability in the logged monthly consumption expenditure per capita. The findings suggest that the size of households, education of household heads, and regional variations are the major contributing factors to consumption expenditure inequality in Malaysia, with household size being among the highest. Other household head characteristics, including ethnicity, strata, and citizenship, have small contributions to the total explained inequality. However, sex and age of household heads contributed negatively to inequality and have inequality decreasing effects, with a negative impact on inequality. A large percentage of unexplained inequality is not captured by these factors, which may be attributed to either unobserved household attributes or residuals. The results are important for policy implications and should be taken into account in formulating future policies, especially those aiming to reduce inequality among the population and thus improving living standards and well-being.

The role of dwelling type on food expenditure: a cross-sectional analysis of the 2015–2016 Australian Household Expenditure Survey

Objective: To explore differences in proportion of food budget and total food expenditure by dwelling type. Design: A cross-sectional study using data from the Australian Bureau of Statistics 2015–2016 Household Expenditure Survey. Food expenditure was examined on multiple categories: fresh fruits, fresh vegetables, pre-prepared meals, meals in restaurants, hotels and clubs, and fast food and takeaway meals, using two-part models and zero-one inflated beta regression models. Dwelling types were categorised as separate house, semi-detached house, low-rise apartment and high-rise apartment. Setting: Australia, 2015–2016. Participants: Seven thousand three hundred and fifty-eight households from greater capital city areas. Results: Households living in high-rise apartments were estimated to allocate a greater proportion of their food budget to meals in restaurants, hotels and clubs, and to spend more (actual dollars) on that category, compared with other dwelling types. No substantial differences were estimated in the proportion of food budget allocated to the other food categories across dwelling types. Conclusions: The dwelling type households live in may play a role in their food budget. Households living in a high-rise apartment may potentially spend more on meals in restaurants, hotels and clubs than those living in other dwelling types. Given the growth in urban population and the changes in living arrangements, findings point to the critical need for a better understanding of the influence of dwelling types on food expenditure and call for research investigating the relationship between the two.

Modelling the Demand of Fresh Meat by Households in Malaysia

There have been some changes in Malaysians’ food preference as Malaysia is one of the most developing countries in Asia. These changes in consumption pattern have some impact on the agriculturally based food industry. One of the changes is in the preference for fresh meat such as poultry, beef, mutton, and other meat. This study is focusing on demand elasticity of fresh meat by households in Malaysia. This study has obtained demand elasticity of fresh meat via Linear Approximate Almost Ideal Demand System (LA-AIDS). Data from the Household Expenditure Survey (HES) 2014 has been used to build a statistical model in estimating the demand elasticity. Keywords: demand elasticity; Linear Approximate Almost Ideal Demand (LA-AIDS); Household Expenditure Survey (HES) 2014

Household expenditure patterns in Kuwait

Household expenditure is the second prominent component of GDP for Kuwait, consisting of 43% GDP, and it has been moderately growing for the past decade. It is essential to understand the nature of household expenditure, a fundamental macroeconomic driver with immense significance for policymaking. This paper utilises the latest Kuwait Household Expenditure Survey data to study household expenditure patterns in Kuwait. It examines and compares the variation of household expenditure patterns for nationals (Kuwaitis) and expatriate households over nine different major commodity groups. The paper investigates the patterns of household expenditure and the response of their characteristics on the level of expenditure by employing Heckman two-step estimation method. The results suggest that different factors affect the probability of consuming a commodity and the level of expenditure between the two household groups. Kuwaiti’s expenditure is more responsive to food, housing, communication and recreation commodities and less responsive to clothing, health, transportation and restaurants than expatriates. In general, there is a significant variation of expenditure patterns across all commodities between the two household groups.