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235707

Econometric Study of the Price Differences Impact between Domestic and Imported Cattle Meat on Egyptian Consumer Surplus

Article

Last updated: 04 Jan 2025

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Tags

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Abstract

In addition to livestock sector challenges in Egypt, beef and veal market suffers from decreasing self-sufficiency rate from 75% to 56%, and increasing prices of domestic and import beef during (2002-2020). The problems of this study are: (1) the variation of price increase between domestic and imported beef may declines consumer welfare, (2) imported beef is very discriminated by origin of country (Brazil, India, and rest of world) and product type (boneless and in-bone), and so the total aggregation may causes considerable bias in demand model. According to mentioned problems, the paper aims at: (1) Econometric estimation of the demand system to derive elasticity parameters and check the model inconsistency or aggregation bias. (2) Calculation consumer surplus due to price increase of domestic and imported beef. Rotterdam demand system in the framework of aggregation bias approach is applied to get consistent parameters. Results verify the existence of aggregation problem according to Wald test in the restricted Seemingly Unrelated Regression Estimation (SURE) model. Additionally, for domestic beef, expenditure elasticity is lower than one, and more than one for foreign beef. On the other hand, price elasticity of domestic beef is inelastic and weakly substitute for the foreign beef, while the contrary is not true for foreign beef. Consumers should be compensated by about 21.5% and 10.5 % respectively as domestic and foreign beef prices increase over the average prices. Future research should consider the aggregation bias in estimating elasticities and consumer welfare in demand systems under various income categories and sectors.

DOI

10.21608/jaess.2022.128192.1033

Keywords

Aggregation, bias, Compensated, Variation, SURE

Authors

First Name

Elham

Last Name

Abdelaal

MiddleName

-

Affiliation

Socioeconomic studies department, Desert Research Center,

Email

abdelaal_elham1971@yahoo.com

City

Cairo

Orcid

0000000219319922

Volume

13

Article Issue

3

Related Issue

33957

Issue Date

2022-03-01

Receive Date

2022-03-09

Publish Date

2022-03-01

Page Start

75

Page End

80

Print ISSN

2090-3634

Online ISSN

2090-3715

Link

https://jaess.journals.ekb.eg/article_235707.html

Detail API

https://jaess.journals.ekb.eg/service?article_code=235707

Order

3

Type

Original Article

Type Code

884

Publication Type

Journal

Publication Title

Journal of Agricultural Economics and Social Sciences

Publication Link

https://jaess.journals.ekb.eg/

MainTitle

Econometric Study of the Price Differences Impact between Domestic and Imported Cattle Meat on Egyptian Consumer Surplus

Details

Type

Article

Created At

22 Jan 2023