Demand for Food in the Philippines: Responses to Price and Income Changes

Abstract

A member of the class of demand systems proposed by Blundell et al. (1993) is employed to improve the structure of food consumption responses in the Philippines. In general it is found that the income elasticity of demand for cereal is about 0.1 and that this elasticity does not drop rapidly with the level of income as is often suggested in the literature. This response is consistent with expectations concerning conversion ratios of cereal consumption to calorie-intake and gains in body weight. Moreover, while food price responses vary from one income group to another, or between rural and urban areas, the variation is not as large as has commonly been presumed.