Changing Consumer Buying Habits in Developing Countries: A Disaggregate Demand Analysis for Fruits and Vegetables in Vietnam

Abstract

Abstract Food systems in developing countries are currently undergoing a rapid transformation, with important implications for local farmers, wholesalers, and retailers. While supply side as-pects of this transformation have been analyzed previously, issues of consumer demand have received much less attention. This paper analyzes changing consumption habits for fresh fruits and vegetables in Vietnam, using household survey data and a demand systems ap-proach. Demand for products from modern supply chains – particularly modern retailers and non-traditional imports – is highly income elastic. Also, supermarket expansion impacts on consumer demand. This implies a continued restructuring of the food sector in the further process of economic development. Keywords: transformation of food systems, supermarkets, food safety, non-traditional im-ports, South-East Asia, Vietnam JEL classification: D12, O12, Q13 Economic growth, international market integration, urbanization, and changing lifestyles are associated with transformations in the food systems of developing countries. The increasing role of modern retail outlets, food safety and quality standards, vertical market integration, and international trade in high-value products characterize these changes (Pingali 2006). Different authors have looked into the rise of supermarkets in developing countries (e.g. Reardon et al. 2003). The growing role of private food safety and quality standards was examined by Henson and Reardon (2005) and Unnevehr (2000) highlighted the induced difficulties for devel-