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Demand for food commodities by income groups in Indonesia

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  • Helen Jensen
  • Justo Manrique

Abstract

An analysis of the structure of demand was performed on household data, classified into income groups for urban Indonesia. A demographically augmented linearized almost ideal demand system was used to estimate the structural parameters of the demand equations. Endogenous switching regression techniques yielded unbiased and consistent demand parameter estimates for the low-income group, which had a large number of zeros for some food groups. Standard seemingly unrelated equation techniques were used to estimate the demand parameters for the other income groups. The results showed demands for the medium to high- and high-income households to be responsive to prices, income and demographic variables. Demands for the medium to low-income households were responsive to income and prices only. Demands for low-income households were responsive to income and prices of rice and fish only.

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  • Helen Jensen & Justo Manrique, 1998. "Demand for food commodities by income groups in Indonesia," Applied Economics, Taylor & Francis Journals, vol. 30(4), pages 491-501.
    • Handle: RePEc:taf:applec:v:30:y:1998:i:4:p:491-501
    DOI: 10.1080/000368498325750
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    9. Pangaribowo, Evita Hanie & Tsegai, Daniel W., 2011. "Food Demand Analysis of Indonesian Households with Particular Attention to the Poorest," Discussion Papers 116748, University of Bonn, Center for Development Research (ZEF).
    10. A., Laajimi & L. M., Albisu, 1997. "La demande de viandes et de poissons en Espagne : une analyse micro-économique," Cahiers d'Economie et Sociologie Rurales, INRA Department of Economics, vol. 42, pages 71-91.
    11. Olivia, Susan & Gibson, John, 2003. "Unit Value Biases in Meat Demand in Indonesia," 2003 Conference (47th), February 12-14, 2003, Fremantle, Australia 58195, Australian Agricultural and Resource Economics Society.
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    14. Gibson, John & Rozelle, Scott, 2002. "Demand Systems With Unit Values: Comparisons With Elasticities from Market Prices," 2002 Conference (46th), February 13-15, 2002, Canberra, Australia 173980, Australian Agricultural and Resource Economics Society.
    15. Aliakbar KHOSRAVINEJAD, 2008. "Welfare Effects of Food Desubsidization For Iranian Urban Households (The Index Number and Demand System Approach)," EcoMod2008 23800063, EcoMod.
    16. Olivia, Susan & Gibson, John, 2005. "Unit Value Biases in Price Elasticities of Demand for Meat in Indonesia," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 13.
    17. Johan Lundberg & Sofia Lundberg, 2012. "Distributional Effects of Lower Food Prices in a Rich Country," Journal of Consumer Policy, Springer, vol. 35(3), pages 373-391, September.
    18. Huffman, Sonya Kostova, 2001. "Welfare And Labor Force Participation Of Low-Wealth Families: Implications For Labor Supply," 2001 Annual meeting, August 5-8, Chicago, IL 20609, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
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    21. Rulof Petrus Burger & Lodewicus Charl Coetzee & Carl Friedrich Kreuser & Neil Andrew Rankin, 2017. "Income and Price Elasticities of Demand in South Africa: An Application of the Linear Expenditure System," South African Journal of Economics, Economic Society of South Africa, vol. 85(4), pages 491-514, December.

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