Household Consumption Response to Food Price Shocks and the Vulnerability of the Poor in Mexico

Avalos, Antonio

doi:10.1002/jid.3127

Cited by 9 publications

(7 citation statements)

References 32 publications

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“…The expansion of the middle class throughout Mexico will yield increased business for sellers of branded goods, facilitating retailer growth (Business Monitor International, 2017). While these trends seem encouraging to sellers, fluctuations in food prices in Mexico over the last 50 years have resulted in greater share of household income being directed toward the purchase of basic goods (Torres Torres, 2010; Székely Pardo & Díaz, 2014;Avalos, 2016). This has pushed consumers to make adjustments in their purchase of food and non-food items, based on their socio-economic characteristics (Nicita, 2008).…”

Section: The Food Retail Industry In Mexicomentioning

confidence: 99%

A study of food retailing: How does consumer price sensitivity vary across food categories and retailer types in Mexico?

Díaz

Ivanic

Watanabe

2019

CyA

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<p>The cost of food in Mexico has increased over several decades while modern retailers face intense rivalry. Currently, consumers have several choices for buying food, which prompts retail managers to implement pricing strategies designed to differentiate from competitors and attract more customers. The problem is that several retailers seem to be using the same approach without a clear understanding of consumer price sensitivity, the effect of non-price promotions, and the variations across retail formats. This research will address these issues by analyzing scanner sales data and mystery shopper price reports to calculate price sensitivity across six food categories sold in four retail chains. Results indicate that product demand, in most food categories, is sensitive to price changes at big-box retail competitors and not traditional supermarket retailers. Additionally, results indicate that the six food categories in the study are sensitive to feature advertising. Retail managers can use these findings to help define their value propositions, focus their pricing strategies, and inform their marketing communications strategy.<strong></strong></p>

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Section: The Food Retail Industry In Mexicomentioning

confidence: 99%

A study of food retailing: How does consumer price sensitivity vary across food categories and retailer types in Mexico?

Díaz

Ivanic

Watanabe

2019

CyA

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“…Studies focused on assessing the welfare impacts of rising prices of food on households have been carried out in several countries i.e. Groom and Tak (2015) and De Janvry and Sadoulet (2009) for India; Azzam and Rettab (2012) for the United Arab Emirates; Aftab et al (2015) for Pakistan; Attanasio et al (2013) and Avalos (2016) for Mexico; Allo et al (2018) and Sa'diyah et al for Indonesia;Ferreira et al (2013) for Brazil; Tefera et al (2012) and Shimeles and Woldemichael (2013) for Ethiopia; Dimova (2015) for Sub-Saharan Africa; Aftab et al (2017) for South Asian Countries; Anríquez et al (2013) for various countries; Cudjoe et al (2010) for Ghana; Layani et al (2020) for Iran; Adoho and Gansey (2019) for Congo; Aghabeygi and Arfini (2020) for Italy; and De Janvry and Sadoulet (2010) for Guatemala. However, few studies have been done for Indonesia urban households regarding food price increases and changes in welfare.…”

Section: Introductionmentioning

confidence: 99%

Assessing the Welfare Effects of Rising Prices of Animal-Derived Sources of Food on Urban Households in Indonesia

Khoiriyah

Forgenie

Iriany

et al. 2023

jeb

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Animal-derived food is a major source of protein for urban households in Indonesia. Rise in animal-derived food prices reduces consumption, causing households to consume less food than the recommended amount which can lead to serious health deficiencies that has serious implications for health and well-being in the long-run. The effects of rising prices of animal-derived protein source on urban households' welfare is examined in this study. The Quadratic Almost Ideal Demand System model is used to analyze household consumption patterns, while the welfare effects of rising prices is measured using compensating and equivalent variation. The data for this study came from the 2021 National Socio-Economic Survey (Susenas), which included 112,569 households. Price elasticity of demand reveals that fish was the most responsive to changes in price while eggs were the least. Based on income elasticity of demand, all animal-derived sources of protein were found to be luxurious except for eggs which were found to be a normal good. The welfare exercise found that increase in prices resulted in approximately Rp. 23,262 per month in welfare loss when there is no substitution. However, when there is substitution, welfare loss as measured by CV was Rp. 22,308 and EV was Rp. 21,052 per month. Urban households were found to experience the most welfare loss from price increase of eggs but the least from fish. It was also found that when urban households are able to substitute when prices increase, the welfare impact is smaller than when they are not able to do so. Hence, policy aimed at diversifying urban households' consumption patterns when it comes to protein consumption is suggested as a means of attaining protein food and nutrition security.

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“…The impact of rising food prices on poor households is particularly significant, given that their food consumption level may already be at subsistence level, and the additional strain increases their vulnerability to food insecurity (Gregory andColeman-Jensen 2013, Amolegbe et al 2021). Furthermore, food price increases are also found to exacerbate poverty in various countries globally (Headey and Martin 2016, Warr and Yusuf 2014, Dhahri and Omri 2020 Several studies have been conducted in various countries to evaluate the impacts of rising food prices on households, including Groom and Tak (2015) and De Janvry and Sadoulet (2009) for India, Attanasio et al (2013) and Avalos (2016) for Mexico, Cudjoe et al (2010) for Ghana, Khoiriyah et al (2023) and Allo et al (2018) for Indonesia, Ferreira et al (2013) and Dimova (2015) for Brazil, Azzam and Rettab (2013) and Azzam and Rettab (2012) for the UAE, Aftab et al (2015) and Idrees et al (2012) for Pakistan, Aftab et al (2017) for South Asian Countries, Tefera et al (2012) and Shimeles and Woldemichael (2013) for Ethiopia, Layani et al (2020) and Farajzadeh and Esmaeili (2017) for Iran, Aghabeygi and Arfini (2020) for Italy, Van Wyk and Dlamini (2018) and Giwa and Choga (2020) for South Africa, and Adoho and Gansey (2019) for the Congo among many others. However, no study that explicitly focuses on the welfare impacts of rising global price of imported food on Haitian consumers has been done to date.…”

Section: Introductionmentioning

confidence: 99%

An Empirical Assessment of the Welfare Impacts of the Rising Global Price of Food: The Case of Haiti

Forgenie¹,

Khoiriyah²,

Zhu³

et al. 2023

jeb

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Global food price inflation has serious implication toward welfare and food and nutrition security in developing countries where most of the population are classified as low-income and are net-food importers. Haiti is one such nation which depend heavily on trade for food, making them extremely vulnerable to global food price increase. This study aims to investigate the welfare impact of rising global prices of imported food on Haitian consumers using annual data from 1980-2021. The LA-AIDS model was employed to estimate Hicksian price and income elasticities for the five major imported food categories, and compensating variation was used to assess the welfare impacts of rising global food prices on Haitian consumers. The study finds that all imported food categories were import price inelastic, except for meat which was price elastic. Cross-price elasticities indicated substitution and complementary relationships between various pairs of imported food categories. Income elasticities showed that demand for cereals and dairy was income inelastic, while demand for meat, vegetable oil, and sugar was income elastic. The welfare exercise revealed that price increases between 2006-2008, 2010-2013, and 2020-2021 resulted in welfare losses of around US$223.91 million, US$89.33 million, and US$458.50 million, respectively. It was also discovered that imported cereals and vegetable oil accounted for most of the lost welfare during the study periods. The results of this study provide valuable information for policymakers to develop policy intervention strategies that aims to safeguard the welfare of Haitian consumers.

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Household Consumption Response to Food Price Shocks and the Vulnerability of the Poor in Mexico

Cited by 9 publications

References 32 publications

A study of food retailing: How does consumer price sensitivity vary across food categories and retailer types in Mexico?

A study of food retailing: How does consumer price sensitivity vary across food categories and retailer types in Mexico?

Assessing the Welfare Effects of Rising Prices of Animal-Derived Sources of Food on Urban Households in Indonesia

An Empirical Assessment of the Welfare Impacts of the Rising Global Price of Food: The Case of Haiti

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