An analysis of structure change of food demand in China

Type Thesis or Dissertation - Master Thesis in Economics
Title An analysis of structure change of food demand in China
Author(s)
Publication (Day/Month/Year) 2014
URL http://munin.uit.no/bitstream/handle/10037/6864/thesis.pdf?sequence=1
Abstract
The estimation of consumer demand is playing an important role in applied econometrics.
Chinese food demand has fundamentally changed as the result of growing income and
urbanization ever since the economic reform in 1978. Although food demand of the western
countries has been widely studied in the literature, the study of demand in the developing
countries like China has been much ignored. In this study, we aim at analyzing structure
changes of food demands in China. We intend to estimate Chinese household consumer
demand for five food categories at a regional level by applying the Rotterdam model, Almost
Ideal Demand System (AIDS), and the CBS model and we use a 17-year period household
survey dataset. Price elasticities and expenditure elasticities are estimated for all five main
food categories in five regions in China. The trend effects on food consumptions are also
modeled and presented. Apart from the temporal food consumption structure changes, which
are mostly studied in empirical researches, we have also researched on spatial structure
changes, which is rather new in this field.
Our estimate results have provided evidences for structural change in Chinese food
consumption patterns. Household food consumption pattern is shifting from „mainly grain
together with little fiber and protein? in less developed regions to „less grain together with
much fiber and protein? in more developed regions. Our results are supported by most of the
empirical researches. However due to data limitations currently, we would expect there still
exist improvements in our future study. And more precise results will be obtained if food
categories are divided into more specific food types.

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