The Effects of Social Characteristics of Iranian Households on Food Consumption Expenditures

Mohammad Mowlaei () and Aburaihan Intezar ()
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Mohammad Mowlaei : Bu-Ali Sina University
Aburaihan Intezar : Jawzjan University, Afghanistan

Journal of Money and Economy, 2019, vol. 14, issue 4, 555-572

Abstract: By using the household data on food consumption, income and other social indicators including activity status, age, literacy, place of residence employment, and marital status, this paper aims to investigate the transitory impact of temporary and permanent income shocks on food consumption in Iran over the period 2009-2014. To study the deterministic effects of the household on food consumption and income, firstly, an Ordinary Least Squares (OLS) method is used to estimate the impact of some Iranian social characteristics on households’ income and food consumption. Then, the variance– covariance structure of income and food consumption processes is utilized, which has described by the Permanent-Temporary model (PT) to identify the characterizing parameters, which link the behavior of consumption and income to estimate the consumption-smoothing parameters. The results indicate that there is nearly complete food consumption smoothing against temporary and permanent income shocks throughout the sample period. Moreover, households’ social indicators have significant effects on their food consumption, income levels, and insurance opportunities.

Keywords: Temporary and Permanent Income Shocks; Household Consumption; Covariance Constraints; Consumption Smoothing; Complete Insurance (search for similar items in EconPapers)
JEL-codes: D12 D91 I30 (search for similar items in EconPapers)
Date: 2019
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