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A two-stage rural household demand analysis: microdata evidence from Jiangsu Province, China

Gao, X.M.; Wailes, E.J.; Cramer, G.L.

American Journal of Agricultural Economics 78(3): 604-613

1996


ISSN/ISBN: 0002-9092
DOI: 10.2307/1243278
Accession: 002744406

In this paper we evaluate economic and demographic effects on China's rural household demand for nine food commodities: vegetables, pork, beef and lamb, poultry, eggs, fish, sugar, fruit, and grain, and five nonfood commodity groups: clothing, fuel, stimulants, housing, and durables. A two-stage budgeting allocation procedure is used to obtain an empirically tractable amalgamative demand system for food commodities which combine an upper-level AIDS model and a lower-level GLES as a modeling framework. The results indicate that the slow growth of food consumption in China during the latter half of the 1980s is a result of income stagnation rather than consumption saturation. Growth in the demand for better food and shelter by Chinese rural households will continue to be a major concern.

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