Analysis of Food Demand in Peru: Implications for Food–Feed Competition

In their policy proposals on how best to stimulate economic growth, economists have been increasingly emphasizing free markets. It is, however, possible that free‐market‐led economic growth can lead to increased income inequity which can further increase poverty. One of the more interesting but thus far insufficiently explored mechanisms for the latter is food–feed competition. Using Peruvian Living Standard Survey (PLSS) data for 1985–86 and 1990, the paper examines the demand patterns of households and concludes that the empirical evidence is in agreement with the hypotheses underlying the theory of food–feed competition.