Abstract
Data is used to analyze the food acquisition behavior of households from a 1980/81 survey designed to be nationally sectorally and regionally representative of Sri Lanka. The poor are shown to be much more responsive to price and income changes than other income groups. The urban population generally exhibits lower income elasticities of demand for food commodities. The poor appear to efficient substitutors thereby mitigating the effects of a price change on caloric intake. The important exception is rice whose elasticity of calorie consumption with respect to price was about 4 times higher than for any other commodity. The reluctance of households to substitute for rice even when faced with rising prices coupled with its large budget share show rice to be the most important consumption good. Higher rice prices are an important determinant of poverty for landless and urban workers. Moderating food prices preferably through technological change is a key ingredient to raising consumption among the poor. Simulations show that even if there are rapid and proportional increases in expenditures of all income groups this will not dramatically increase caloric intake among the poor. However if the absolute value of the increase in real expenditures were distributed equally to all households there would be a marked increase in the % of households consuming an adequate diet.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.