Household Demand Analyses in Uyo Metropolis: A Study of Selected Determinants Responsiveness

Abstract

The study is an attempt to evaluate household demand analyses in Uyo metropolis: a study of selected determinants responsiveness. The research employed survey data obtained from 200 households via individual interviews utilizing a meticulously designed questionnaire. Information on income, age, sex of household head, household size, educational background was collected to capture household demography. The data were also collected on household expenditure on the selected food and nonfood item, their respective prices and the quantity consumed in a given month. The study adopted the quadratic almost ideal demand system (QUAIDS) as a model. The result indicated that factors that affect household food expenditure on Rice, Beans and Garri are the prices of the goods, income, household size, level of education and the prices of other goods. Similarly, the study found negative compensated and uncompensated own price elasticity of demand for the food items rice, beans and garri while beer has a positive own price effect. All the goods were found to be price inelastic as their own price elasticity lies between -1 and 1. Again, all food items were found to have negative cross price elasticity and which is less than one indicating that they are substitutes and price inelastic. On the other hand, the study found evidence of complementary relationship between beer and food items like garri and beans. The study recommends that the government subsidize food prices, lower taxes on these goods, provide cash transfers to the poor, or promote the production of these food items by giving preference to farmers who produce them in order to lessen the impact of such price increases on the demand for these commodities.