Food Demand In Pakistan: Analysis And Projections
Author: Naveed Hayat

This study analyzes the household food demand followed by projecting the future level demand of selected food commodities groups such as foodgrains, pulses, ghee, milk, sugar, meat and vegetables in Pakistan. This study uses Pakistan Panel Household survey (PPHS) for the year 2010 conducted by Pakistan Institute of Development Economics (PIDE).The other sources of data included Economic Research Service (ERS) Macro Economic Data set (2005) and Asian Development Bank (ADB) Key Indicators for Asia and the Pacific (2010). The Linear Approximation Almost Ideal Demand System (LA/AIDS) model is used to estimate the demand elasticities while a simple growth model is used for food demand projections. The empirical results reveal that all estimated income elasticities are positive. All uncompensated and compensated own-price elasticities have correct (negative) sign. On the basis of income elasticities, foodgrains, pulses, ghee, sugar and vegetables are found necessities, while milk and meat are identified as luxuries. Except of meat, other six food commodities groups have inelastic own-price elasticities implies that they are integral items of household diet. Pulses and vegetables, ghee and meat, milk and sugar are identifies as gross compliments on the basis of uncompensated cross-price elasticities. The uncompensated cross-price elasticities of foodgrains indicate substitutive relationship with pulses, meat and vegetables, respectively. An increase in the household income will induce substantial expansion in household demand for milk and meat products but consumption of these foods will decline if household size grew ceteris paribus. The food demand projection for the year 2010 to 2030 suggests that keeping prices constant when the population grow by 2 percent per annum then per capita and total household food demand increase for the next two decades. It is concluded that household food demand has been primarily driven by growth in population and income. The estimated expenditure elasticities of food commodities groups calls for food support program. There exists a direct relationship between household size and food demand therefore, various population control measures may improve the standard of living of Pakistani households.The estimated results about food demand projection calls for formulating food policy to ensure food security in Pakistan. Supervisor:- Dr. Anwar Hussain

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Keywords : Food, Food Demand, Food Demand-Pakistan
Supervisor: Anwar Hussain

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