Saeed Karimi; Saeed Rasekhi; Mojtaba Ehsani
Volume 13, Issue 39 , July 2009, , Pages 147-166
Abstract
Governments have an important role in planning and preparing the food these security through protection policies such as subsidizing the basic food in the same time pay subsidies it will increase the government expenditure,and hence, it is necessary to set specific goals carefully. In this article, the ...
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Governments have an important role in planning and preparing the food these security through protection policies such as subsidizing the basic food in the same time pay subsidies it will increase the government expenditure,and hence, it is necessary to set specific goals carefully. In this article, the demand for main or basic foods, (i.e.bread, meat, milk, edible, oil and sugar) have been estimated by using AIDS Model and taking into account household budget in urban areas and consumer price index through two stage model and cointegration for the years 1934-2005. & estimation was done for both the short-run and the long-run and the homogenous constraint and symmetric have been examined by Wald test. As an instrument of analysis, price elasticity, income elasticity and cross price elasticity of demand have been calculated for the short-run and the long-run. The results show that reducing subsidies on these goods would put a pressure on consumer expenditure through the rise in the prices. However, changes in the structure of subsidies with a gradual reduction in the amount of subsidies for bread, edible oil and sugar and directing the payment toward meat and milk within a specific goal is recommended.
Zakria Farajzadeh; Bahaeddin Najafi
Volume 6, Issue 20 , October 2004, , Pages 135-156
Abstract
Subsidizing is one of the income transfer channels that are mainly paid in order to protect low-income groups and improve the income distribution. Budgetary constraints of developing countries and necessity of providing the poor with their basic needs are the main reasons of targeting subsidies. ...
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Subsidizing is one of the income transfer channels that are mainly paid in order to protect low-income groups and improve the income distribution. Budgetary constraints of developing countries and necessity of providing the poor with their basic needs are the main reasons of targeting subsidies. Evaluating the current consumption pattern of choosen commodities indicates a significant difference between rural and urban deciles in terms of physical amount and allocated expenditures. So, in terms of quality and quantity, higher income deciles are now more benefited. Consumption behavior of rural and urban consumers also revealed that the subsidized commodities are consumed as a complementary set. Impact of increasing price of the subsidized commodities on calorie intakes, income of deciles and poverty indices was investigated by using different scenarios of price increment. The nutritional effects of increasing price of all commodities together show that rural consumers is affected more than urban ones. In terms of calorie intakes through the most of deciles, increment of rice price affect urban consumers more than rural consumers and in the case of bread a reverse trend is observed. Among the rural and urban income deciles reduction in calorie intakes is also relatively irregular. Considering the income effects of increasing price of sugar and bread indicate that rural consumers experience a more reduction in income relative to urban consumers. The price increment of rice and all commodities together mainly affect low-income deciles in urban regions and high income deciles in rural regions. Based on the results, it is suggested that income deciles in both rural and urban regions to be recognized and subsidized commodities to be distributed among the deciles located under poverty line. However, in case of reduction in subsidies, it should take place by selected commodities and gradually.