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Household Demand for Food in Switzerland. A Quadratic Almost Ideal Demand System

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  • Awudu Abdulai

Abstract

In this paper we estimate a complete demand system for Switzerland, with emphasis on food demand, using a recent household expenditure survey. The Quadratic Almost Ideal Demand System (QUAIDS) is employed in the analysis of six food commodity and a non-food groups. The quadratic terms in the QUAIDS were found to be empirically important in describing household budget behaviour in Switzerland. For most food commodity groups, demand is inelastic, with elasticities ranging between -0.64 and -1.02. Cross-price elasticities are very low, suggesting limited possibilities of substitution between food groups. All food groups are found to be necessities, while the non-food group is a luxury. The estimated own-price and expenditure elasticities from the specification on groups segmented by income show that for most food commodities, own-price (absolutely) and expenditure elasticities are consistently higher for the lower income group.

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Bibliographic Info

Article provided by Swiss Society of Economics and Statistics (SSES) in its journal Swiss Journal of Economics and Statistics.

Volume (Year): 138 (2002)
Issue (Month): I (March)
Pages: 1-18

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Handle: RePEc:ses:arsjes:2002-i-1

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Keywords: QUAIDS model; food demand elasticities; Swiss households;

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References

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  1. Filippini, Massimo, 1995. "Electricity demand by time of use An application of the household AIDS model," Energy Economics, Elsevier, vol. 17(3), pages 197-204, July.
  2. Muellbauer, John, 1976. "Community Preferences and the Representative Consumer," Econometrica, Econometric Society, vol. 44(5), pages 979-99, September.
  3. James Banks & Richard Blundell & Arthur Lewbel, 1994. "Tax reform and welfare measurement: do we need demand system estimation?," IFS Working Papers W94/11, Institute for Fiscal Studies.
  4. James Banks & Richard Blundell & Arthur Lewbel, 1997. "Quadratic Engel Curves And Consumer Demand," The Review of Economics and Statistics, MIT Press, vol. 79(4), pages 527-539, November.
  5. Pollak, Robert A & Wales, Terence J, 1978. "Estimation of Complete Demand Systems from Household Budget Data: The Linear and Quadratic Expenditure Systems," American Economic Review, American Economic Association, vol. 68(3), pages 348-59, June.
  6. Lewbel, Arthur, 1991. "The Rank of Demand Systems: Theory and Nonparametric Estimation," Econometrica, Econometric Society, vol. 59(3), pages 711-30, May.
  7. Filippini, Massimo, 1995. "Swiss residential demand for electricity by time-of-use," Resource and Energy Economics, Elsevier, vol. 17(3), pages 281-290, November.
  8. Blundell, Richard & Pashardes, Panos & Weber, Guglielmo, 1993. "What Do We Learn About Consumer Demand Patterns from Micro Data?," American Economic Review, American Economic Association, vol. 83(3), pages 570-97, June.
  9. D Moro & P Sckokai, 2000. "Heterogeneous preferences in household food consumption in Italy," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 27(3), pages 305-323, September.
  10. Browning, Martin & Meghir, Costas, 1991. "The Effects of Male and Female Labor Supply on Commodity Demands," Econometrica, Econometric Society, vol. 59(4), pages 925-51, July.
  11. Awudu Abdulai & Devendra K. Jain & Ashok K. Sharma, 1999. "Household Food Demand Analysis in India," Journal of Agricultural Economics, Wiley Blackwell, vol. 50(2), pages 316-327.
  12. Massimo Filippini, 1995. "Swiss Residential Demand for Electricity by Time-of-Use: An Application of the Almost Ideal Demand System," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1), pages 27-40.
  13. Deaton, Angus S & Muellbauer, John, 1980. "An Almost Ideal Demand System," American Economic Review, American Economic Association, vol. 70(3), pages 312-26, June.
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Cited by:
  1. Abiodun Elijah Obayelu & V.O. Okoruwa & O.I.Y. Ajani, 2009. "Cross-sectional analysis of food demand in the North Central, Nigeria: The quadratic almost ideal demand system (QUAIDS) approach," China Agricultural Economic Review, Emerald Group Publishing, vol. 1(2), pages 173-193, May.
  2. 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).
  3. Gould, Brian W. & Dong, Diansheng, 2004. "Product Quality And The Demand For Food: The Case Of Urban China," 2004 Annual meeting, August 1-4, Denver, CO 20010, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  4. Surabhi Mittal, 2010. "Application of the Quaids Model to the Food Sector in India," Journal of Quantitative Economics, The Indian Econometric Society, vol. 8(1), pages 42-54, January.
  5. Abdulai, Awudu & Aubert, Dominique, 2004. "A cross-section analysis of household demand for food and nutrients in Tanzania," Agricultural Economics, Blackwell, vol. 31(1), pages 67-79, July.
  6. Marian Rizov & Anrej Cupak & Jan Pokrivcak, 2014. "Food demand patters in the new EU member states: The case of Slovakia," EcoMod2014 6959, EcoMod.

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