IMPACT Center

Demand for Food Commodities in India: Sociodemographic Stratification and the Effect of Durable Goods

Principal Investigator

Dr. Ron C. Mittelhammer

Completion Date

December 31, 2006

 

Problem Addressed

To study demand for food commodities in India, with particular focus on sociodemographic stratification and the effect of durable goods on food demand.

Goal

The principal objectives of this study are to investigate and identify: (a) Interrelationships between the levels of household expenditures on food commodities and household ownership/investment in durable goods of the type that can affect food preparation and storage; (b) Effects of a wide array of sociodemographic factors on food consumption patterns throughout the states of India, resulting in a stratification of food demand by sociodemographic profile; (c) Factors affecting current and future household durable goods ownership in India of the type that have the potential to affect food demand; (d) Project future expanding and declining food marketing opportunities in India based on the results of a)-c).

Implications

It is expected that insights gained regarding the identification of food consumption patterns stratified by sociodemographic profiles, and in particular the effect of the trend towards higher income households in possession of durable good facilitating food preparation and storage, will provide valuable marketing information to prospective importers considering this potentially very large and growing Indian market for food commodities.

Procedures

To build a theoretical model that can address these problems and then apply the model on the household expenditure data of India collected by NSSO (National Sample Survey Organization), India.

To this point, a conceptual model has been specified that is being applied empirically to data, and the research team is in the process of analyzing household expenditure data for India that was collected by the NSSO (National Sample Survey Organization) of India.. Given the dimensionality of the data and the complexity of the mixture model being estimated, the analysis was temporarily hampered by computer resource limitations, but a new and powerful computer was just purchased for the project (this was actually anticipated in the original project statement and budget), and empirical analysis is now proceeding.

Techniques and Technologies Developed

The use of a mixture model to estimate different utility function regimes that are conditioned on different complements of durable goods used in food preparation and storage is novel and has not been pursued heretofore. The methodology has the potential to provide a new, theoretically defensible and computationally tractable method of estimating demand systems when there are alternative demand regimes involved in determining consumption patterns.

Publications/Journal Articles From Project

Publications in refereed journal articles, as well as paper presentations at professional meetings of economists will be pursued.

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