Application of the Quaids Model to the Food Sector in India
Higher economic growth has led to diversification of the consumption bundle of households away from staple food. This has implications for the food policy as demand projections for different commodities impacts the farmers decision to diversify its production base which further has implications for the issue of food security. Thus it becomes important to project the demand, based on most realistic demand elasticities. Using the households consumer expenditure survey of the major National Sample Survey rounds, the paper estimates the price and expenditure elasticity’s of different food items/ groups in India. A two-stage Quadratic AIDS (QUAIDS) model is used to compute coefficients and calculate the demand elasticity’s. In this model assumption of linearity in the expenditure function is given away.
Volume (Year): 8 (2010)
Issue (Month): 1 (January)
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