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Food Demand in Russia: Heterogeneous Consumer Segments over Time
Author(s) -
Staudigel Matthias,
Schröck Rebecca
Publication year - 2015
Publication title -
journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.157
H-Index - 61
eISSN - 1477-9552
pISSN - 0021-857X
DOI - 10.1111/1477-9552.12102
Subject(s) - economics , almost ideal demand system , consumption (sociology) , agricultural economics , population , panel data , consumer demand , consumer expenditure survey , order (exchange) , food consumption , food prices , cluster (spacecraft) , production (economics) , econometrics , microeconomics , food security , public economics , geography , agriculture , sociology , social science , demography , aggregate expenditure , archaeology , finance , computer science , programming language
The Russian food system has undergone substantial changes. However, knowledge on how economic transition has affected the structural parameters of food demand is lacking. Based on a two‐stage LES ‐ LA / AIDS model and annual panel data from the Russia Longitudinal Monitoring Survey (1995–2010), we provide a comprehensive set of food demand elasticities for Russia along two dimensions. First, we estimate demand parameters for three characteristic time periods in order to trace changes during transition. Second, to account for the Russian population's diversity, we derive elasticities for five different consumer segments. These groups are established by a cluster analysis based on households' food purchases. Our findings suggest that demand for food is far from satiated in Russia. We find generally high unconditional expenditure and own‐price elasticities for food. Both expenditure and own‐price elasticities show slight decreases in absolute terms over time. Low expenditure elasticities for staple foods like bread or cereals and high values for luxury goods such as meat, alcohol and tobacco suggest considerable changes in the composition of food baskets with further income growth. Results indicate that food production at home loses in importance while more affluent households in particular increase their demand for food consumption away from home.