In this study, National Bureau of Statistics of China (NBS) data from 1995 to 2012 was used to investigate the link between growing income and rising animal foods demand in China. Due to China’s population size, the latter has implications for mankind on a global scale, ranging from the acceleration of climate change to the exacerbation of health risks and threats to food security. It is therefore vital to understand to what extent the increasing prosperity of the world’s most populous country connects to higher demand for animal products.
Two approaches were chosen to compute income elasticities: an OLS estimator and an Almost Ideal Demand System (AIDS), which lead to significantly different results. The AIDS model produced more reliable estimates, indicating a rise of poultry consumption parallel to increasing income, a rising share of income being spent on aquatic products, and decreasing demand for eggs for urban households. Due to the lack of out-of-home consumption data, these results likely understate the real demand.
Table of Contents
1 Introduction
2 Review of Relevant Literature
2.1 Literature on China
2.2 Literature on the World
2.3 Literature on China’s Statistics
3 Data
4 Estimation Method
4.1 OLS-Estimation
4.2 LA/AIDS-Estimation
5 Results
6 Conclusions
Objectives and Topics
This paper aims to analyze the correlation between income growth and the demand for animal products in China, specifically examining how changes in net income influence consumption patterns across rural and urban households to forecast future demand and environmental impact.
- Investigation of income elasticity regarding animal food consumption.
- Comparative analysis between urban and rural household consumption patterns.
- Application of OLS and Almost Ideal Demand System (AIDS) econometric models.
- Evaluation of data consistency from the National Bureau of Statistics (NBS).
- Assessment of the environmental and health implications related to dietary shifts.
Excerpt from the Book
1 Introduction
Significant challenges for mankind are exacerbated due to the consumption of foods from animal sources, i.e. pork, beef, mutton, poultry, fish, eggs and milk. First, animal agriculture propels climate change, as it causes the emission of a major share of global greenhouse gas (GHG) emissions. While beef and milk cattle largely contribute through their methane emissions, other land animals emit less, but still considerable amounts of CO2 equivalents. Global livestock accounts for 14.5% of human-caused GHG (FAO, 2013). A diet including aquatic products instead of meat is not as detrimental to the climate as is livestock, but more so than a vegetarian or vegan food composition (Scarborough et al., 2014).
Apart from their impact on the global climate, animal products affect the availability of natural resources, and therefore food security. While 1 kg of paddy rice requires 2300 L of freshwater (Hoekstra and Chapagain, 2008) and 3 m2 of land (Gerbens-Leenes, 2006), the same amount of pork - providing less nutritional energy (Voedingscentrum, 1998) - causes 4850 L of freshwater (Hoekstra and Chapagain, 2008) and 9 m2 of land (Gerbens-Leenes and Nonhebel, 2005) to be used. With the prospect of continuing world population growth, an efficient use of agricultural resources is of interest for food security.
Summary of Chapters
1 Introduction: Discusses the environmental and health-related challenges associated with animal product consumption and establishes the research goal of linking Chinese income growth to demand.
2 Review of Relevant Literature: Surveys existing research on animal product consumption in China, global consumption trends, and the reliability of Chinese statistical data.
3 Data: Describes the usage of National Bureau of Statistics (NBS) data from 1995 to 2012, including variables like per capita income, consumption, and price indices.
4 Estimation Method: Details the econometric models employed, specifically the OLS estimator and the Almost Ideal Demand System (AIDS), to calculate income elasticities.
5 Results: Presents the regression outputs for urban and rural households, comparing findings from different estimation methods and discussing statistical significance.
6 Conclusions: Summarizes the findings, noting the discrepancy between model results and the potential policy implications for the Chinese Health Ministry regarding diet and livestock management.
Keywords
China, Income Growth, Animal Product Consumption, Demand Analysis, OLS Estimator, LA/AIDS, Income Elasticity, Urban Households, Rural Households, Food Security, Climate Change, Livestock, Statistics, Econometrics, Consumer Demand.
Frequently Asked Questions
What is the primary focus of this research paper?
The paper examines the relationship between rising income levels and the increasing demand for animal products in China, highlighting the broader environmental and health impacts of this consumption trend.
What are the central themes discussed in the study?
The study centers on the intersection of economic growth, dietary changes, resource efficiency, and the accuracy of Chinese national consumption statistics.
What is the primary research question?
The research asks what the recent income elasticities of animal foods are in China, how these elasticities differ between rural and urban populations, and how they have evolved over time.
Which econometric methods are utilized?
The author uses Ordinary Least Squares (OLS) estimators for both rural and urban datasets and the Almost Ideal Demand System (AIDS) for urban household expenditure analysis.
What is covered in the main body of the paper?
The main body covers a literature review, a detailed explanation of the data sources from the National Bureau of Statistics, the mathematical formulation of the models, and a presentation and discussion of the regression results.
Which keywords best characterize this work?
Key terms include China, Income Growth, Animal Product Consumption, Demand Analysis, OLS Estimator, LA/AIDS, and Income Elasticity.
Why did the author conclude that the AIDS model produces more reliable results than the OLS model?
The AIDS model is theoretically better integrated and avoids contemporaneous correlation issues inherent in the simpler OLS approach.
How does the lack of out-of-home consumption data affect the results?
The author suggests that omitting data on food consumed away from home—which is particularly common for urban dwellers—leads to an underestimation of real demand and potentially explains some discrepancies in the elasticities found.
- Arbeit zitieren
- Justus Kirchhoff (Autor:in), 2017, Chinese Income Growth and Animal Product Consumption. A Demand Analysis, München, GRIN Verlag, https://www.grin.com/document/371178
