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The Demand for Food Quality in Rural China
Author(s) -
Yu Xiaohua,
Abler David
Publication year - 2009
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.1111/j.1467-8276.2008.01159.x
Subject(s) - china , economics , unit (ring theory) , quality (philosophy) , agricultural economics , food prices , household income , empirical research , econometrics , agriculture , food security , geography , statistics , philosophy , mathematics education , mathematics , archaeology , epistemology
Many studies of food demand do not use actual prices but unit values, obtained by dividing expenditures by the quantity consumed. This can bias empirical analyses because unit values are not exogenous market prices; they reflect household food quality choices within each food category. This article develops a framework for assessing the resulting bias in income and price elasticities of demand and applies the framework to data for rural China. Empirical results indicate that households in rural China tend to consume higher‐quality food as income increases, with a greater sensitivity to income for basic foods than for luxury foods.