Effects of urbanization on food demand in China

Abstract

Urbanization in China has been on a steady rise recently, which has contributed to the changing consumer food preferences and consumption patterns. This carries significant implications for food security in China and the global food trade, given the role China plays on global food markets. This study investigates the effects of urbanization on food demand in China by adopting an empirical framework that incorporates urbanization into a theory plausible demand system. It also considers the effects of urbanization-induced loss of agricultural land and increased pollution on food production resource quality and food supply. Modeling the demand and supply components simultaneously allows us to undertake equilibrium analysis to determine prices. Based on the urbanization elasticities derived and estimated in this study, our findings indicate that urbanization has increased demand for meats, fruit, and eggs, while reducing demand for grains, vegetables, and fats and oils.