Predicting the changes in the structure of food demand in China

Abstract

Abstract A complete demand system is estimated separately for urban and rural residents using a two‐stage almost ideal demand system–quadratic almost ideal demand system model and pooled provincial and time‐series data from 2000 to 2012. The estimated demand elasticities with respect to income and demographic variables are then used to predict the changes in the structure of food demand in China for the year 2030. Results of this study suggest that, as per capita incomes grow further while both urbanization and population aging continue their upward trends, the shares of expenditures on foods away from home are expected to rise while the shares of spending on foods at home would decline, and that at‐home food budget shares of grains are expected to continue decreasing whereas at‐home food budget shares of foods with animal origins and fruits would be on the rise. Thus, food security in China has been transformed into feed grain security.