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Food Demand Elasticities in Australia

  • Mehmet Ulubasoglu


  • Debdulal Mallick
  • Mokhtarul Wadud
  • Phillip Hone
  • Henry Haszler

This study presents disaggregated food demand elasticities for Australia using data drawn from the latest two national Household Expenditure Surveys covering the period 1998/99 and 2003/04. Adopting an Almost Ideal Demand System approach, a food demand system is estimated for 15 food categories, which cover a significant portion of the food items in households’ shopping lists. Own-price, cross-price and expenditure elasticity estimates have been derived for all categories. Elasticities for households with Australian-born heads are also computed. The parameters reported measure longer run responsiveness at the household level and represent the first integrated set of food demand elasticities based on a highly disaggregated food demand system estimated for Australia. The underlying food demand elasticities obtained in this study all accord with economic intuition and theory. Importantly, but not surprisingly, some of these elasticities differ, in a policy relevant sense, from the estimates found in earlier studies.

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Paper provided by Deakin University, Faculty of Business and Law, School of Accounting, Economics and Finance in its series Economics Series with number 2010_17.

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Date of creation: 11 Nov 2010
Date of revision:
Handle: RePEc:dkn:econwp:eco_2010_17
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  1. Seale, James & Regmi, Anita & Bernstein, Jason, 2003. "International Evidence on Food Consumption Patterns," Technical Bulletins 184321, United States Department of Agriculture, Economic Research Service.
  2. Hyde, Charles Evan & Perloff, Jeffrey M., 1996. "Multimarket Market Power Estimation: The Australian Retail Meat Sector," 1997 Conference (41st), January 22-24, 1997, Gold Coast, Australia 136227, Australian Agricultural and Resource Economics Society.
  3. Nicholas E. Piggott & James A. Chalfant & Julian M. Alston & Garry R. Griffith, 1996. "Demand Response to Advertising in the Australian Meat Industry," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(2), pages 268-279.
  4. Chouinard Hayley H & Davis David E & LaFrance Jeffrey T & Perloff Jeffrey M, 2007. "Fat Taxes: Big Money for Small Change," Forum for Health Economics & Policy, De Gruyter, vol. 10(2), pages 1-30, June.
  5. Selvanathan, Saroja, 1991. "Regional Consumption Patterns in Australia: A System-Wide Analysis," The Economic Record, The Economic Society of Australia, vol. 67(199), pages 339-45, December.
  6. Powell, Alan A. & Snape, Richard H., 1993. "The contribution of applied general equilibrium analysis to policy reform in Australia," Journal of Policy Modeling, Elsevier, vol. 15(4), pages 393-414, August.
  7. Paul Cashin, 1991. "A Model Of The Disaggregated Demand For Meat In Australia," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 35(3), pages 263-283, December.
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