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Abstract
In contrast to the myriad of empirical work on food demand in other countries, very few studies
have considered zero expenditures on some food groups. Those which have attempted have been
based on techniques which result in endogeneity and inefficient estimates which in turn may
misinform policy calibration. Improving on methodological flaw of previous studies, the present
study censors zero expenditures in the first stage using simulation based maximum likelihood
multivariate probit. In the second stage, Quadratic Almost Ideal Demand System which allows
for a more realistic assumption of curvature in Engels curve is estimated. In turn, food
expenditure and price elasticities are derived. In view of the high expenditure elasticities,
considering a policy option that would enhance rural consumer income is desirable, since it will
result in high consumption thereby providing more incentives for food production.