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Quadratic Food Engel Curves with Measurement Error: Evidence from a Budget Survey

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  • Sourafel Girma
  • Abbi M. Kedir

    ()

Abstract

In this paper we estimate quadratic food Engel curves with measurement error using the 1994 Ethiopian Urban Household Budget Survey. In sharp contrast to the findings from developed countries, food share is found to increase with expenditure, and only starts to decline after some threshold level of expenditure. We establish the robustness of this inverted-U relationship by estimating a more flexible semiparametric model that corrects for the endogeneity of expenditure. The potential policy distortion that may result from neglecting the problem of measurement error in the estimation of Engel curves is also discussed.

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Bibliographic Info

Paper provided by Department of Economics, University of Leicester in its series Discussion Papers in Economics with number 03/17.

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Date of creation: Dec 2003
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Handle: RePEc:lec:leecon:03/17

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Related research

Keywords: quadratic food Engel curves; measurement error; instrumental variable estimator; semi-parametric models;

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Cited by:
  1. Orazio Attanasio & Erich Battistin & Alice Mesnard, 2012. "Food and Cash Transfers: Evidence from Colombia," Economic Journal, Royal Economic Society, vol. 122(559), pages 92-124, 03.
  2. Rijkers, Bob & Soderbom, Mans & Loening, Josef, 2009. "Mind the gap ? a rural-urban comparison of manufacturing firms," Policy Research Working Paper Series 4946, The World Bank.
  3. De Agostini, Paola, 2014. "The effect of food prices and household income on the British diet," ISER Working Paper Series 2014-10, Institute for Social and Economic Research.
  4. Diagne, Youssoupha S & Diop, Mouhamadou M, 2007. "Quelles solutions à la hausse continue de la facture publique pétrolière : maintien des appuis à la consommation ou libre fixation des prix par le marché ?
    [Impact of energy subsidies withdraw
    ," MPRA Paper 54807, University Library of Munich, Germany.

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