Analysis of the Demand for Rice in Kaduna State, Nigeria
No 3/2013, September
Abstract
The kernel of this study was to ascertain the determinants of rice consumption and the compensated as well as the uncompensated demand for rice in Kaduna State using household consumption data obtained from a sample of 310 households through the instrumentality of a structured questionnaire. LA-AIDS model was employed to analyse the data and the result of the data analysis showed that the price of rice, price of beans, price of maize, price of yam, food expenditure, age of household head, household income and number of household income earners were all significant in influencing the households demand for rice. The estimated compensated (-0.7921) and uncompensated(-0.8887) own price elasticities of rice indicated that rice was price inelastic and the estimated expenditure(0.69) elasticity of rice indicated that rice is not a luxury in the households food basket but a necessity. From the findings of the study, it is recommended that efforts at increasing supply of local rice should be intensified as this will reduce the prices of local rice brands and invariably enhance demand for local rice by households as rice was estimated to be own-price inelastic and also, rice should be prioritized as a core food crop in food security programmes as it was found to be a necessity in households food basket.
Keywords
Consumption, Demand, Rice, LA-AIDS Model, Kaduna State.