On Price Endogeneity in the Analysis of Food Demand in China

Price endogeneity has been ignored in previous analyses of food demand in China. We examine agricultural input price data from the China National Bureau of Statistics and use reduced-form price equations to account for price endogeneity in this setting. Applying our unique econometric approach to the analysis of provincial-level food demand in China, we find strong statistical evidence of price endogeneity. Models that ignore price endogeneity result in substantially biased elasticities and misleading estimates of future food demand in China.


Issue Date:
May 24 2014
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/169767
Page range:
2-42
Total Pages:
42
JEL Codes:
Q11; Q13; Q17
Series Statement:
Selected Paper
5217




 Record created 2017-04-01, last modified 2017-08-27

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