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Abstract

In Italy as one of the developed countries, the agricultural sector is reason to supplying food, food security and food safety. In this study, the amount and value of imports for various foodstuffs in Italy has been used. At first, compensatory price elasticities were calculated by using the Almost Ideal Demand System (AIDS) and the effect of increasing the global price of food on welfare was studied. The results show that the welfare index of compensatory changes calculated for the entire food groups is 1061.48 billion USD. Meat and fruit groups have the most and the least compensatory changes respectively.

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