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Income and price elasticities of food items across the globe

Author

Listed:
  • Anda Nugroho

    (Commonwealth Scientific and Industrial Research Organisation)

  • Marc Mariano

    (Commonwealth Scientific and Industrial Research Organisation)

  • George Verikios

    (Commonwealth Scientific and Industrial Research Organisation and Department of Accounting, Finance and Economics, Griffith University)

  • Kenneth Clements

    (Department of Economics, University of Western Australia)

Abstract

Widely used global food demand elasticities often derive from outdated sources and insufficiently examined theoretical assumptions. This paper addresses both concerns by estimating a Rotterdam-style demand system for eleven food categories using pooled 2017–2021 International Comparison Program data covering 173 countries. We test structural stability across rounds, validate pooling, and conduct bootstrap likelihood-ratio tests of homogeneity, symmetry, preference independence, and no-price effects restrictions. Results reveal staples and vegetables are necessities while meat and alcohol are luxuries, with income sensitivity declining at higher incomes. Price sensitivity is substantially higher in low-income countries, highlighting their disproportionate vulnerability to food price hikes. Cross-price elasticities indicate dominant substitution relationships, especially among animal proteins. The resulting elasticity set can serve as an updated, empirically grounded input for global food policy modelling

Suggested Citation

  • Anda Nugroho & Marc Mariano & George Verikios & Kenneth Clements, 2026. "Income and price elasticities of food items across the globe," Economics Discussion / Working Papers 26-01, The University of Western Australia, Department of Economics.
    • Handle: RePEc:uwa:wpaper:26-01
    Note: MD5 = bede21f121dfb3dfec256995c54dacbc
    as

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    References listed on IDEAS

    as
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    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • F61 - International Economics - - Economic Impacts of Globalization - - - Microeconomic Impacts
    • Q11 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Aggregate Supply and Demand Analysis; Prices
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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