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The Effect of Socioeconomic Variables on Provincial Bread Demand Using QAIDS Model

Author

Listed:
  • Mehrani , Taha

    (University of Tehran)

  • Ghasemimand , Fatemeh

    (Shahid Beheshti University)

  • Salem , Ali Asghar

    (Allameh Tabataba'i University)

Abstract

In this study, the effect of socioeconomic variables on provincial bread demand using the QUAIDS model has been investigated. In this model, socioeconomic variables such as age, gender and marital status of the head of household, the education level of the head of household and spouse’s head of household, household size, and occupation status of the head household have been used. The virtual variable of the target law of subsidies is also used to study the effects of this policy. To this end, the quadratic almost ideal demand system was applied. This model has been estimated using the consolidated data and Iterated Linear Least Squares Estimator and the information of more than 165,000 urban households in Iran for the years 1386-1394 and for different provinces. The results of the research show that during the studied years, bread is an essential good for all provinces except in Isfahan, Chaharmahal o Bakhtyari, and Kohgilouye. The compensated and uncompensated price elasticities of bread for all provinces are negative and less than one, so the bread is an inelastic good for all provinces. Also, the coefficients related to household size, gender, and marital status of the head of household and the target law of subsidies are positive and significant.

Suggested Citation

  • Mehrani , Taha & Ghasemimand , Fatemeh & Salem , Ali Asghar, 2019. "The Effect of Socioeconomic Variables on Provincial Bread Demand Using QAIDS Model," Journal of Money and Economy, Monetary and Banking Research Institute, Central Bank of the Islamic Republic of Iran, vol. 14(4), pages 525-554, October.
    • Handle: RePEc:mbr:jmonec:v:14:y:2019:i:4:p:525-554
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    References listed on IDEAS

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    More about this item

    Keywords

    Bread Demand; Quadratic Almost Ideal Demand System; Socio-Economic Variables; Iterated Linear Least squares Estimator; Reforming Subsidies;
    All these keywords.

    JEL classification:

    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis

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