A Demand Systems Analysis of Food Commodities by U.S. Households Segmented by Income

Abstract

Abstract Using the 1987–88 Nationwide Food Consumption Survey, twelve food commodity groups were analyzed according to household poverty status. Parameter estimates were used to obtain subsistence expenditures, own‐price elasticities, expenditure elasticities, and income elasticities. Own‐price elasticities were similar between the income groups for most commodities. However, income elasticities were consistently higher for the lower‐income group. The use of average estimates of price and income elasticities for the population as a whole for the projection of individual commodity demands is not likely to be successful if notable changes are evident in income distribution.