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The Demand for Food Quality in Rural China

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  • Xiaohua Yu
  • David Abler

Abstract

Many studies of food demand do not use actual prices but unit values, obtained by dividing expenditures by the quantity consumed. This can bias empirical analyses because unit values are not exogenous market prices; they reflect household food quality choices within each food category. This article develops a framework for assessing the resulting bias in income and price elasticities of demand and applies the framework to data for rural China. Empirical results indicate that households in rural China tend to consume higher-quality food as income increases, with a greater sensitivity to income for basic foods than for luxury foods. Copyright 2009, Oxford University Press.

Suggested Citation

  • Xiaohua Yu & David Abler, 2009. "The Demand for Food Quality in Rural China," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(1), pages 57-69.
  • Handle: RePEc:oup:ajagec:v:91:y:2009:i:1:p:57-69
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    File URL: http://hdl.handle.net/10.1111/j.1467-8276.2008.01159.x
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