Analysis of Food Consumption

Analysis of Food Consumption

Analysis of Changes in Food Consumption pattern in Urban Ethiopia
(Draft)

By Tadesse Kuma Worako Ethiopian Development Research Institute E-mail: kwtadesse@yahoo.com Tel: 0911402976

Submitted for the Seventh International Conference on the Ethiopian Economy June 2009

January 2009

1

Analysis of Changes in Food Consumption pattern in Urban Ethiopia
Abstract Consumption expenditure on different food items are generally used as main yardstick for measuring standard of living in developing nations. Study of temporal changes in consumption patterns provides an insight into status of welfare changes and helpful in planning future investment decisions. In Ethiopia, since early 1990s there has been several efforts by the government to alleviate poverty at national level. Thus understanding changes in urban consumption pattern provide valuable policy information on the effectiveness of policies designed to alleviate poverty. Accordingly, this paper investigates the phenomenon of changes in consumption expenditure in urban Ethiopia using two rounds (1994 and 2004) household survey data from the Ethiopian Urban Household survey (EUHS) for ten food categories. The study employed Working-Leser expenditure share model to estimate income elasticity of demand and determinants of urban household consumption for Addis Ababa city and six major towns. The study also extended its analysis by running simulations for rise in per capita income. The results from the decomposition of per capita consumption into different demographic and economic factors confirm that urban household consumption patterns started to shift from staple food grains to high value food products. The simulations and estimated income elasticity of demand for cereals, pulses and spices find to be much lower than those of non-staple high value products which is consistent with earlier findings. This ongoing transition in food consumption pattern will affect domestic food market that supply side...

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