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A Synthetic Demand System: An Application to U.S. Consumer Demand for Rice and Selected Rice Substitutes

Author

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  • X.M. Gao
  • Eric J. Wailes
  • Gail L. Cramer

Abstract

This article presents estimates of economic and demographic effects on the demand for rice and its complex carbohydrate substitutes: potatoes, bread, and pasta. Using a synthetic level version demand system which nests the Almost Ideal Demand System (AIDS) model, the level version Rotterdam model, and the Central Bureau of Statistics (CBS) model, the results indicate: (1) inelastic demand for all four goods; (2) significant cross-price effects; and (3) all goods are Hicksian substitutes. The impacts of demographic variables, such as household size, age structure, region, ethic origin, and having nursing children are significant. Quality and consumer perception of rice as a healthy food are also important in explaining consumer demand.

Suggested Citation

  • X.M. Gao & Eric J. Wailes & Gail L. Cramer, 1994. "A Synthetic Demand System: An Application to U.S. Consumer Demand for Rice and Selected Rice Substitutes," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 16(1), pages 27-38.
    • Handle: RePEc:oup:revage:v:16:y:1994:i:1:p:27-38.
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    Cited by:

    1. Huang, Kuo S. & Lin, Biing-Hwan, 2000. "Estimation of Food Demand Nutrient Elasticities from household Survey Data," Technical Bulletins 184370, United States Department of Agriculture, Economic Research Service.
    2. Shiptsova, Rimma & Goodwin, Harold L., Jr. & Holcomb, Rodney B., 2004. "Household Expenditure Patterns for Carbohydrate Sources in Russia," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 29(2), pages 1-12, August.
    3. Teisl, Mario F. & Roe, Brian & Hicks, Robert L., 2002. "Can Eco-Labels Tune a Market? Evidence from Dolphin-Safe Labeling," Journal of Environmental Economics and Management, Elsevier, vol. 43(3), pages 339-359, May.
    4. B. Rudders, David & Ward, John M., 2015. "Own-price elasticity of open access supply as a long-run measure of fish stock abundance," Marine Policy, Elsevier, vol. 53(C), pages 215-226.
    5. Richards, Timothy J. & Gao, X.M. & Patternson, Paul M., 1996. "Branded and Generic Promotion in a Complex Carbohydrate Demand System: A Structural Latent Variable Approach to Promotion Evaluation," Economic Evaluation of Commodity Promotion Programs in the Current Legal and Political Environment, October 7-8, 1996, Monterey, California 279667, Regional Research Projects > NECC-63: Research Committee on Commodity Promotion.
    6. Vu, Linh Hoang, 2012. "Estimation Of Food Demand In Vietnam," MPRA Paper 94801, University Library of Munich, Germany.
    7. Richards, Timothy J. & Kagan, Albert & Gao, Xiaoming, 1997. "Factors Influencing Changes In Potato And Potato Substitute Demand," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 26(1), pages 1-15, April.
    8. Eugene Jones, 1997. "Consumer demand for carbohydrates: A look across products and income classes," Agribusiness, John Wiley & Sons, Ltd., vol. 13(6), pages 599-612.
    9. Jones, Eugene, 2001. "Agricultural Economics Research And Its Usefulness To Private Firms: Some Unsolicited Observations," Journal of Food Distribution Research, Food Distribution Research Society, vol. 32(1), pages 1-7, March.
    10. Zhai, Tianchang & Wang, Jingjing & Li, Lei & Si, Wei, 2021. "Based on Volume or Sugar Content: Comparison of Consumer Welfare Effects of Different Consumption Tax Strategies for Sugar-Sweetened Beverages——Evidence from Urban China," 2021 Conference, August 17-31, 2021, Virtual 315103, International Association of Agricultural Economists.

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