Income elasticity of food expenditures

Just a quick note on the research on agricultural supply chains that I’m doing right now – I’m finding it fascinating that one can guess at the nutritional status of households based on their income elasticity of food expenditures.  Poorer households tend to have an elasticity of demand close to one, suggesting that people who are far from getting their nutritional needs met will spend almost all additional income on food.  Wealthier households in developing countries, on the other hand, are more likely to have an elasticity of close to zero, suggesting that people who are well-nourished will spend little additional income on food. Of course, it’s also been found that some wealthier households have an elasticity of caloric intake close to 0.5, hinting that as income goes up, consumption of packaged foods that are more expensive and less healthy may crowd out some cheaper and more nutritious foods.  This is so cool – graphical representations of the complex social & economic realities that govern food choices.

2 thoughts on “Income elasticity of food expenditures

  1. Nice. I am doing some research on food expenditure and poverty status. May you share your paper or provide some references so that i can make the same argument as you did?
    Thanks

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    1. Hi Hasan – thanks for reading along! I’ll have to dig up the paper, as it currently lives on an old hard drive that I don’t have with me at the moment (traveling for the summer), but I’d be happy to pass it along once I find it.

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