Important Determinants Of Demand Research Articles

Economic Value of Recreational Benefits from the Mudumalai Tiger Reserve, Tamil Nadu, India: An Individual Travel Cost Approach

The study reported in this article estimates the economic value of recreational benefits of the Mudumalai Tiger Reserve (MTR) in the Nilgiris district of Tamil Nadu, and its determinants using the Individual Travel Cost Method. The tiger reserves in India account for more than a half of the world’s tiger population and are providing a variety of ecosystem services. Most of these services, recreational services in particular, are non-marketed in nature. Hence, the economic value of the recreation services needs to be measured so that the public’s scarce resources can be allocated efficiently for future protection, planning and managing the tiger reserves. Based on the information from primary surveys, our estimated result indicates that the annual recreational value of the MTR is equivalent to ₹114.26 million. The study also found that travel cost, respondent income, family size, gender and site quality are the most important determinants of demand for recreation at MTR. This implies that the recreational value generated by the MTR is significant and more investment in the reserve will enhance future recreational benefits as well as various other ecosystem benefits.

ČIMBENICI POTRAŽNJE ZA DOBROVOLJNIM ZDRAVSTVENIM OSIGURANJEM U EUROPSKIM ZEMLJAMA

During the pandemic, health care services have gained in importance. One of the ways used to finance these services is through voluntary private health insurance. Existing studies on the demand for voluntary private health insurance are based predominantly on the micro-economic level. Therefore, the aim of this paper is to analyse the factors of demand at the macro-economic level. The analysis covers economic and demographic factors, the quality of the public health care system, risk aversion and the status of the population’s health. The empirical research is based on the databases of 29 European countries in the period from 2013 to 2017 and on the dynamic panel model. The results of the empirical analysis revealed that income, price, urbanization, health care system quality, risk aversion/education and self-perceived health are important determinants of demand for voluntary private health insurance in European countries.

Income inequality and the quality of imports

This paper studies the role of income inequality in the importing country as a determinant of export unit value and product quality estimated employing information on market shares and prices. Using detailed firm-level data, we find that higher inequality in the destination market is associated with lower unit value and product quality. Noticeably, the negative effect of inequality is stronger in richer destinations. Firm-level heterogeneous responses to market conditions explain changes in unit value and quality. Incumbent exporting firms report lower unit value when income inequality increases, while entrants supply products of lower quality. All in all, our findings show that income inequality is a determinant of import demand which ultimately induces quality and unit value differentials across markets.

Determinants of Rice Import Demand in Nigeria

Primarily, the study examined the determinants of rice import demand in Nigeria by assessing the short run and long run dynamic model relationships among the determinants, trends and extent of causality among per capita income, population, exchange rate and price of rice imports were equally examined, using data obtained from the Central Bank of Nigeria (CBN) and National Bureau of statistics (NBS) over the period 1961 to 2013. Data obtained showed the perceived determinants of imports demand for rice in Nigeria were local rice production, rice import price, rice consumption, per capita income, and exchange rate, price of local rice, domestic stock variation, maize price, meat price and demographic development. The short run dynamic model result showed that rice consumption, price of meat, price of maize, local rice quantity, demography development and stock variance are statistically significant at 5%. The significance of the coefficient of the error correction term confirmed theappropriateness of the error correction approach which also showed that ignoring the long run relationship is detrimental. The result however, revealed that rice import demand increases significantly with increasing rice consumption, increasing price of meat, increasing price of maize (keeping that for imported rice unchanged) and increasing demography development. Rice import price, per capita income, price of local rice and exchange rate had no significant effects on rice import demand. The study therefore recommends that locally-produced rice should be intensively improved.
 Keywords: demography, determinants, Error correction mechanism, rice import demand

Price and Income Elasticity of Demand for Services in India: A Macro Analysis

India has a higher share of services and rapid growth in its services sector that have contributed to the overall economic growth phenomenally. The services revolution recently experienced have caused services-led growth in India. There have been questions raised on the sustainability of services-led growth achieved by India. Besides exports of services, domestic consumers and producers also consume services. Domestic demand for services equally contributes to India’s services-led growth paradigm. The New Economic Policy, 1991 has a significant role in taking India on a services-led growth paradigm. The present study is an attempt to provide a substantial theoretical explanation through demand-side to support services-led growth. The paper estimates the demand for services overall and also for disaggregated sub-sectoral services. The present study estimates the price and income elasticity of demand for services from 1951 to 2010. The study endeavours to find structural changes in demand for services during pre and post-liberalised periods (1951–1990 and 1991–2010) through the most important determinants of demand for any product/service, that is, price and income. The study finds a structural change in demand for services corresponding to income and price. The study finds that India’s services are income elastic and are very unresponsive for the increase in price. Hence, it substantiates that domestic demand for services will help to sustain the services-led growth.

Commodities' Preferences and Determinants of Demand Among University Students in Nigeria

The study investigates preferences for commodities and determinants of demand among the students of Obafemi Awolowo University, Ile-Ife, Nigeria. Out of 140 respondents, 91% reveals that they prefer food items to all other items, 87% preferred academic books and other literature, 78% indicates a preference for credit cards, internet data plans, and other mobile subscriptions. Sixty-six percent (66%) disclosed their preference for hairstyles, 64% preferred clothing and foot wares, 63% preferred to save, 61% preferred mobile devices and technologies and 53% preferred medical care services. However, majority of the respondents reveals less preference for jewellery and cosmetics (69%) as well as parties and entertainments (82%). In addition, the study reveals that there are a number of factors that determine a student's demand for commodities. The study found students’ income as a very important determinant, while prices, taste, time and savings were rated as important determinants of demand among university students in Nigeria.

Inferring the Economics of Store Density from Closures: The Starbucks Case

This paper proposes a method that makes use of firms’ mass store closures to measure the store network effects of cannibalization and density economies. I calculate each store’s contribution to chain-level profits via one-store perturbations on the set of retained stores, and map these onto the firm’s closure choices. To separate the demand- and supply-side store network effects, I exploit the fact that the business-stealing effect intensifies with local network density, whereas the supply-side disadvantage prevails at sparse regions of the network. I apply the method to study the Starbucks chain. The average rate of cannibalization imposed by a neighbor outlet is 1.2% within one mile and 0.4% within one to three miles. For remote outlets, operation costs increase by 0.3% of revenues for each mile of distance from the network. Counterfactual analyses suggest that income level is a more important determinant of demand than population count at low levels of store penetration, whereas high-population regions can sustain denser store networks because of the softening of the cannibalization effect. Data are available at https://doi.org/10.1287/mksc.2017.1078 .

Tradable and non-tradable expenditure and aggregate demand for imports in an emerging market economy

Using an assumption of non-separability of non-tradable expenditure from imports, this paper examines the impact of the structural transformation undertaken after 2001 on imports and, in turn, the current account stance of Turkey. In this regard, an import demand function is derived under the assumption of non-separability, and is estimated using quarterly time series data from Turkey. The empirical results show that the assumption of non-separability cannot be rejected in the case of Turkey and the relative prices of non-tradable and tradable goods must be among the determinants of import demand in addition to the relative price of imports and real GDP. This result accordingly implies that recent increases in import expenditure are, to some extent, due to changes in the relative price structure in favour of non-tradable goods.

Determinants of import demand for Egyptian potatoes in Germany and the United Kingdom

The European Union ( EU) is the major import market for Egyptian fresh potatoes. Germany and the United Kingdom ( UK) jointly imported about 44% of Egyptian potato exports to the EU during the period 1994-2012. This study sought to identify the determinants of import demand for Egyptian potatoes in these two countries. A general differentiated demand system approach was used to estimate conditional potato import demand per country. For each country, it was assumed that the system of conditional import demand equations for potatoes is specified according to the sources of origin and also depends on all imported potato prices and total import potato expenditure. When estimated econometrically, this import demand model allows conditional price and expenditure elasticities to be derived. The econometric results indicated that with an estimated elasticity of 1.95, Egyptian potato exports responded significantly to total expenditure on imported potatoes by Germany. On the other hand, Egyptian potato exports to Germany did not exhibit significant price responses. In all cases but one, estimated conditional uncompensated price elasticities were not statistically different from zero. However, more interesting results were obtained concerning the price responses of Egyptian potato exports to the UK, whereby the conditional ( uncompensated) direct elasticity of potato imports from Egypt to the UK (-0.71) showed an inelastic response to its own price. Furthermore, Egyptian potato exports seemed to compete on the UK market with potatoes originating from Israel and France, while they displayed complementarity with Dutch imports.

Trade Liberalization and Disaggregated Import Demand in Uganda

Studies investigating determinants of import demand for Uganda present aggregate findings yet there is a need to disaggregate the findings for specific sectors. This creates a research gap on disaggregated findings of import demand. This research attempts to fill this research gap by establishing determinants of import demand using disaggregated sector level data for consumer, intermediate and capital goods. The study estimates the long-run and short-run import demand elasticities for consumer, intermediate and capital goods over the period (1994 to 2012). The results show that there exists a cointegrating relationship between the disaggregated import demand and the following set of variables; relative import price, GDP per capita, real effective exchange rate, foreign exchange rate reserves and trade openness. The long run elasticity appears more responsive to import demand compared to the short-run elasticity. Importantly the effect of a change in trade openness on the volume of imports is positive, suggesting trade liberalization increases import demand.

Reviewing Pakistan’s Import Demand Function: A Time-Series Analysis, 1970–2010

This paper investigates the conventional import demand function for Pakistan using time-series data sourced from the World Development Indicators for the period 1970 to 2010. Using a vector error correction model and impulse response functions, we show that, for the given period, relative prices and income lose their significance as long-run determinants of import demand. This indicates the need for additional determinants. We compare the residuals of the conventional import demand function with those of a model that includes the terms of trade and foreign exchange availability (in addition to the conventional parameters) as determinants of import demand, and find that the latter largely resolves much of what is nondeterministic in the former model. The paper also explores the peculiar trend of a falling imports-to-GDP ratio (from the 1980s to the 2000s), which is unusual for a developing country. In a subsidiary regression analysis for this period, we argue that falling net capital inflows explain this persistent fall in the imports-to-GDP ratio. The recovery thereafter, when Pakistan started catching up with other developing economies, may have been responsible for the 2008 balance-of-payments crisis.

The Role of Expenditure Components in Nepal’s Import from India

This article investigates the role of the final expenditure components in determining Nepal’s imports from India using the Autoregressive Distributed Lag approach based on the annual data for the period 1975–2011. The results of bounds testing procedure show that there exists the cointegration between Nepal’s imports from India and its determinants: personal consumption expenditure, government consumption expenditure, investment, exports and relative prices. Among the expenditure components, personal consumption expenditure is a major determinant of import demand from India, with its significant positive impact. The government expenditure is found to have no significant impact on Nepal’s imports from India. Gross domestic investment and exports have negative impact on Nepal’s import demand from India, whereas the relative prices have positive impact, indicating lack of substitutes for Indian imports. Trade liberalization also has positive impact on Nepal’s import from India.

Microinsurance demand: determinants and strategies

Vulnerability to risk, a constant factor in the lives of the poor, is a cause of persistent poverty. Microinsurance offers one approach to mitigating risk, yet demand is disappointingly low. This paper aims to improve the understanding of factors that determine the demand for microinsurance products. Based on a review of more than 30 studies, it blends academic findings with practical examples and presents the most important determinants of demand, including understanding of insurance, client value, liquidity constraints, trust, behavioural factors, and use of other risk coping mechanisms. The paper also presents solutions that can be incorporated into an organization's marketing strategy.

A historical perspective of the link between economic recessions and agricultural trade performance: The case of South Africa’s fruit and wine exports

ABSTRACTThe recent global recession, caused by the financial crisis of 2008–2009, resulted in a significant drop in global merchandise trade. However, international trade in agricultural and food products seemed more resilient. This poses the question as to what extent recent and previous economic recessions have had an effect on the trade flows of these specific products. An understanding of this connection will assist the agricultural sector to pro-actively strategize for future economic downturns in their respective export markets. Hence this study uses South Africa's exports of fresh fruits and wine as a case study and applies an import demand model to analyse the relationship between export flows, several demand factors and economic shocks in its traditional export markets over the last 28 years. The results reveal that change in real per capita income is a much more significant determinant of import demand for South Africa's fruit and wine than the incidence of an economic recession. Contrary to general perceptions, economic downturns even positively affected the import demand for wine and apples.

What does the Chinese market need? An empirical study of the determinants of Chinese imports, 1996–2008

This study provides an in-depth analysis of the determinants of import demand in China through a multilevel approach. Using disaggregated data over 1996–2008 and a dynamic panel model, we find that the Chinese import market is predominantly characterized by quality competition. However, the nature of the competition varies across different industries. In line with theory, quality plays an important role in industries that are characterized by the potential for quality improvement and product differentiation, whereas price is key in industries in which quality and product differences are rather small. Moreover, private consumption expenditure is more influential than other categories of expenditures. Additionally, variables that can influence the relative price of import products, such as the exchange rate, tariffs and the domestic price index, also have an impact on import demand.

Analyzing the Import Demand Function with Expenditure Components: Evidence from Pakistan

This study highlights the responsiveness of import demand in the context of aggregate expenditure components in Pakistan over the period of 1974–2009. The study uses Johansen multivariate cointegration analysis and estimates an error correction model to drive the long-run and short run elasticities of the import demand behavior. The cointegration results provide a strong empirical validity of the presence of long run elasticities between import and macro-components. In the long-run, the consumption expenditure is the main dominant determinants of the movements in import demand in Pakistan. In the short-run, the consumption and investment expenditures are the major determinants of import demand while the import demand is not sensitive to relative price. Moreover, the parameter stability tests confirm the stability of the model, and the sensitivity analysis confirms the robustness of initial results.

The Survey of Oil Income on the Oil Exporting Countries Members’

Petroleum Exporting Countries in the crude oil exports have single-product, in other words income from selling oil or as the most important source of export income, or at least as one of the most important sources of income is considered to be exported.The analysis and policy issues macro-economic delegation, the subject to import demand, a special importance in Pattern Recognition and macro-economy and efficiency of a part of the country's trade policy. For this reason, one of the major issues and a plan for importing goods and studying the factors imports. This paper investigates the empirical determinants of import demand in oil exporting countries. Using a new dataset including a large cross section of oil exporting countries, we show with a panel cointegration analysis that import demand in these countries depends positively on oil income, the real exchange rate. Fiscal surpluses, on the other hand, tend to reduce the demand for imports. So we showed that the equation to import Petroleum Exporting Countries: the price of oil that can be a positive effect ordering that the real imports that are probably through wealth. The Petroleum Exporting Countries to some extent of the price of oil higher profit.

An empirical investigation of two assumptions of motivation testing in captive starlings ( Sturnus vulgaris): Do animals have an energy budget to ‘spend’? and does cost reduce demand?

The use of demand curves to derive estimates of motivational strength is a popular method for measuring animals’ preferences for a range of different resources in applied animal behaviour research. In a typical experiment, an animal pays a gradually increasing cost (e.g. by pushing through a weighted door) in order to access a resource it wants or needs. The resulting demand curves are used to calculate several measures of the strength of the animal's motivation to access the resource. We tested two assumptions that underlie the majority of applications of this approach: first, that animals have a fixed energy budget to spend on access to resources; and second, that the effect of price on demand is not greatly influenced by the order or magnitude of the price changes. Sixteen European starlings ( Sturnus vulgaris) were trained to push through weighted doors to gain access to one of two resources, either a tray of turf, or protective foliage cover. In the first stage of the experiment reservation prices were established for each bird by daily increasing the force necessary to open the door until the bird no longer accessed the resource. In the next stage, five different forces, chosen to evenly cover the range between free entry and each individual bird's reservation price, were presented in a random order under two levels of food availability. Overall, price was the most important determinant of demand. However, birds’ demand for resources was increased by food rationing, suggesting that the cost of pushing the weighted doors might not have been energy. Birds’ willingness to pay for a resource was also dependent upon the order in which the forces were presented, and specifically the contrast from the force presented the previous day. The results support the continued use of presenting costs on an ascending order to measure the demand in captive animals, but suggest that random order presentations can be used to check for order effects. We also suggest that the concept of a finite energy budget that animals have to spend on resources may not be useful in the measurement of captive animals’ preferences and that a different approach might be needed.

The broadband digital divide and the nexus of race, competition, and quality

We examine the gap in broadband access to the Internet between minority groups and white households with geographically fine data on DSL subscription. In addition to income and demographics, we also examine quality of service and competition as components of the Digital Divide. The gaps in DSL demand for blacks and Hispanics do not disappear when income, education, and other demographic variables are accounted for. However, lack of competition is an important driver of the Digital Divide for blacks. Service quality is an important determinant of demand, and ignoring it masks the true size of the DSL gap for Hispanics.

The Broadband Digital Divide and the Nexus of Race, Competition, and Quality

We examine the gap in broadband access to the Internet between minority groups and white households with geographically fine data on DSL subscription. In addition to income and demographics, we also examine quality of service and competition as components of the Digital Divide. The gaps in DSL demand for blacks and Hispanics do not disappear when income, education, and other demographic variables are accounted for. However, lack of competition is an important driver of the Digital Divide for blacks. Service quality is an important determinant of demand, and is related to the DSL gap for some groups.