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Evidence of Engel curves in food away from home: A study of Malaysia

Author

Listed:
  • Tey, (John) Yeong-Sheng
  • Shamsudin, Mad Nasir
  • Mohamed, Zainalabidin
  • Abdullah, Amin Mahir
  • Radam, Alias

Abstract

As Malaysians’ per capita income continues to grow, the food budget shares declines, which refers to Engel’s law. However, the statistics of the various Household Expenditure Surveys in Malaysia reported increasing food away from home (FAFH) budget shares which concerns whether the notion of Engel’s law can be extended to FAFH. By using Household Expenditure Survey 2004/05, the Heckman two-step procedure was applied with the Working-leser and other functional forms to conduct the Engel curves analyses. The empirical results exhibit the same observations as laid down in the Engel’s law. All the estimated expenditure elasticities of demand for FAFH were less than unity. Thus, this study verified that the notion of Engel’s law can be extended to FAFH in Malaysia.

Suggested Citation

  • Tey, (John) Yeong-Sheng & Shamsudin, Mad Nasir & Mohamed, Zainalabidin & Abdullah, Amin Mahir & Radam, Alias, 2009. "Evidence of Engel curves in food away from home: A study of Malaysia," MPRA Paper 14833, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:14833
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    File URL: https://mpra.ub.uni-muenchen.de/14833/1/MPRA_paper_14833.pdf
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    References listed on IDEAS

    as
    1. Vicki A. McCracken & Jon A. Brandt, 1987. "Household Consumption of Food-Away-From-Home: Total Expenditure and by Type of Food Facility," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 69(2), pages 274-284.
    2. Hausman, J. A. & Newey, W. K. & Powell, J. L., 1995. "Nonlinear errors in variables Estimation of some Engel curves," Journal of Econometrics, Elsevier, vol. 65(1), pages 205-233, January.
    3. Richard Blundell & Alan Duncan & Krishna Pendakur, 1998. "Semiparametric estimation and consumer demand," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 13(5), pages 435-461.
    4. Hausman, Jerry A. & Newey, Whitney K. & Ichimura, Hidehiko & Powell, James L., 1991. "Identification and estimation of polynomial errors-in-variables models," Journal of Econometrics, Elsevier, vol. 50(3), pages 273-295, December.
    5. 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.
    6. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
    7. 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 570-597, June.
    8. Lewbel, Arthur, 1991. "The Rank of Demand Systems: Theory and Nonparametric Estimation," Econometrica, Econometric Society, vol. 59(3), pages 711-730, May.
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    Cited by:

    1. Rodrigo García Arancibia, 2013. "Curvas de Engel de alimentos fuera del hogar según circunstancia de consumo. el caso de Argentina," REVISTA CUADERNOS DE ECONOMÍA, UN - RCE - CID, May.

    More about this item

    Keywords

    Engel’s law; food away from home; expenditure elasticity;

    JEL classification:

    • Q11 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Aggregate Supply and Demand Analysis; Prices

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