Differences in Household Food Demand by Income Category As Evidenced in Rural Thailand

Chaowana Phetcharat and Warattaya Chinnakum

No 181, PIER Discussion Papers from Puey Ungphakorn Institute for Economic Research

Abstract: This research investigated the response of food demand to changes in price and income, as well as to determine how demographic variables make an impact on food demand of Thai rural households. Quadratic Almost Ideal Demand System (QUAIDS) was used to obtain parameter estimates of the food demand for 13 food commodities. Findings shows households with more family members tended to purchase high calorie and necessary foods instead of the more expensive and unnecessary one. The percentage of adults aged over 65 had caused negative impact on the demand for rice, starches and pulses, meats and poultry. Signs of expenditure elasticities and own-price elasticities were found consistent with the consumer demand theory. Increase in household food budget led to an increase in demand of eggs and dairy products, rice, ready-to-eat foods, oils and fats, and alcoholic beverage and tobacco. Additionally, all own-price elasticities were negatively related to the budget shares of household food consumption. The households at low level of income are likely to change their budget shares toward the major food groups that provide basic nutrients (e.g., rice, fruits, vegetables, and ready-to-eat products) more than middle-and high-income groups. Estimated income elasticities with respect to rice, eggs and dairy products, fruits, ready-to-eat and instant products, and alcoholic beverage and tobacco were above 0.5 while the income elasticity of rice was in the same range for all household groups.

Keywords: Expenditure elasticity; Food demand; Own-price elasticity; Poverty; Thailand (search for similar items in EconPapers)
JEL-codes: D12 O12 O15 Q18 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2022-06
New Economics Papers: this item is included in nep-agr and nep-sea
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