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Elasticity Estimates by Occupational Groups in Bangladesh: An Application of Food Characteristics Demand System

Author:A. Razzaque, B.H. Kh

The study estimates demand elasticities using the food characteristics demand system for eight different occupational groups in Bangladesh. The methodology, based on the assumption that every food item contributes to overall energy and variety in the diet which together maximises the utility from energy, variety and tastes of individual foods suggests that with increase in incomes, most occupational groups are likely to increase their consumption for non-cereal food items. An agricultural production strategy which emphasises on cereals, particularly on rice, at the expense of other non-cereal crops may thus lead to the emergence of a serious mismatch between the choice of individual food item and its supply in the long run. The high income elasticities of several items e.g. fish, beef, milk and vegetables call for medium to longer term policy interventions to bring about a structural change in the pattern of existing food production in the country.

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