Iranian Agricultural Economics Society (IAES)

Estimating Rural Household Food Demand in Iran Using the QUAIDS Model: Insights for Policy Design

Document Type : Research Article-en

Author

Agricultural Planning, Economics and Rural Development Research Institute (APERDRI), Tehran, Iran

Abstract
Food security, as a key pillar of sustainable development and social welfare, is particularly sensitive to price fluctuations and income volatility in rural communities. In Iran, recent inflationary pressures and declining household purchasing power have highlighted the need for a scientific analysis of food demand patterns and the evaluation of policy interventions. This study aims to provide a policy-oriented analysis of food demand patterns among rural households in Iran and to assess the potential impacts of alternative policy interventions. Data were drawn from the 2023 Household Income and Expenditure Survey, and the Quadratic Almost Ideal Demand System (QUAIDS) was employed to estimate consumption patterns while accounting for theoretical constraints and household demographic characteristics. Eight main food groups—cereals, proteins, dairy, oils and fats, fruits and nuts, vegetables and legumes, sugar and confectionery, and spices and beverages-were analyzed. Results indicate that cereals and proteins function as necessities with low income and price elasticities, whereas vegetables and legumes exhibit more luxury-like characteristics, with consumption increasing at higher income levels. Cross-price elasticities reveal both substitution and complementarity among food groups, providing important insights for the design of pricing and fiscal policies. Demographic factors, including household size, education, and age, significantly influence consumption patterns. Welfare analyses further show that low-income rural households are the most vulnerable to rising food prices. Overall, the findings not only corroborate previous domestic and international studies but also provide new evidence on the sensitivity of food demand to income and price changes in Iran. Based on the estimated income and own-price elasticities, the findings suggest that food subsidy reforms should focus on staple goods with low income and price elasticities to protect low-income rural households, while targeted income support and price stabilization policies are more appropriate for food groups exhibiting high income and own-price responsiveness, such as vegetables and legumes. Furthermore, the presence of significant cross-price substitution effects implies that price interventions in one food group may have spillover effects on the consumption of other foods, which should be considered in policy design.

Keywords

Subjects

Authors retain the copyright. This is an open access article distributed under Creative Commons Attribution 4.0 International License (CC BY 4.0).

  1. Akbari, A., Ahmadi Javid, M., Ziyaee, M., & Barakati, S. (2017). Estimating food demand in Sistan and Baluchestan using two systems of NNDS and QUAIDS. Agricultural Economics Research, 9(34), 93-116. (In Persian).
  2. Andreyeva, T., Long, M.W., & Brownell, K.D. (2010). The impact of food prices on consumption: A systematic review of research on the price elasticity of demand for food. American Journal of Public Health, 100(2), 216–222. https://doi.org/10.2105/AJPH.2008.151415
  3. Ansah, I.G.K., Gardebroek, C., & Ihle, R. (2022). Using assets as resilience capacities for stabilizing food demand of vulnerable households. International Journal of Disaster Risk Reduction, 82, 103352. https://doi.org/10.1016/j.ijdrr.2022.103352
  4. Ataie Solout, K., & Mohammadi, H. (2018). Determining the demand elasticity of selection food product in Mazandaran province by using Almost Ideal Demand System (AIDS) Case study: Hen, Aquatic and Beef Meat. Agricultural Economics Research, 10(39), 173-186. (In Persian)
  5. Baghestany, A.A., & Sherafatmand, H. (2021). Estimation of tea supply and demand elasticities in Iran (Application of threshold regression model). Agricultural Economics Research, 13(3), 30-41. (In Persian). https://doi.org/10.30495/jae.2021.18929.1909
  6. Banks, J., Blundell, R., & Lewbel, A. (1997). Quadratic Engel curves and consumer demand. The Review of Economics and Statistics, 79(4), 527–539. https://doi.org/10.1162/003465397557015
  7. Casado, J.M., Giménez-Nadal, J.I., Labeaga, J.M., & Molina, J.A. (2025). Family size and food consumption: Exploring economies of scale with panel data. Journal of Family and Economic Issues46(2), 373-382. https://doi.org/10.1007/s10834-024-09971-x
  8. Chen, D., Abler, D., Zhou, D., Yu, X., & Thompson, W. (2016). A meta‐analysis of food demand elasticities for China. Applied Economic Perspectives and Policy, 38(1), 50-72. https://doi.org/10.1093/aepp/ppv006
  9. Deaton, A., & Muellbauer, J. (1980). An almost ideal demand system. The American Economic Review, 70(3), 312–326.
  10. Dhar, R., Olabisi, M.A., Ogunbayo, I.E., Olutegbe, N.S., Akano, O.I., & Tschirley, D.L. (2024). Food demand responses to global price shocks: Contrasts in sub-national evidence from Nigeria. Food Security, 16(6), 1419-1443. https://doi.org/10.2139/ssrn.4958337
  11. (2022). The state of food security and nutrition in the world 2022. Rome: Food and Agriculture Organization of the United Nations.
  12. Falsafian, A., Ghahremanzadeh, M., & Malekshahi, S.K. (2024). Welfare effects of food Tariff changes on urban and rural households. Journal of Agricultural Sciences, 30(4), 759-773. https://doi.org/10.15832/ankutbd.1467418
  13. Forgenie, D., Hutchinson, S. D., Mahase-Forgenie, M., & Khoiriyah, N. (2024). Analyzing per capita food consumption patterns in net food-importing developing countries. Journal of Agriculture and Food Research, 18, 101278. https://doi.org/10.1016/j.jafr.2024.101278
  14. Hayat, N., Hussain, A., & Yousaf, H. (2016). Food demand in Pakistan: Analysis and projections. South Asia Economic Journal, 17(1), 94-113. https://doi.org/10.1177/1391561415621826
  15. Khalili Malakshah, S., Ghahremanzadeh, M., & Pishbahar, E. (2021). Effect of household characteristics on food demand of Iranian rural and urban households. Agricultural Economics Research, 12(48), 23-55. (In Persian).
  16. Korir, L., Rizov, M., & Ruto, E. (2018). Analysis of household food demand and its implications on food security in Kenya: an application of QUAIDS model. https://doi.org/10.1016/j.econmod.2020.07.015
  17. Kumar, P., Kumar, A., Parappurathu, S., & Raju, S.S. (2011). Estimation of demand elasticity for food commodities in India. Agricultural Economics Research Review, 24(1), 1–14. https://doi.org/10.22004/ag.econ.109408
  18. Layani, G., & Bakhshoodeh, M. (2025). Effects of rising food prices on poverty and vulnerability of the Iranian rural households. The Economic Research, 16(3), 1-27.
  19. Mekonnen, D.K., Huang, C.L., & Fonsah, E.G. (2012). Analysis of fruit consumption in the US with a Quadratic AIDS model. https://doi.org/10.22004/ag.econ.119767
  20. Muiruri, K.J., Mwenjeri, G., & Kariuki, G. (2025). Food demand patterns and short-term impacts of market shocks among the low-income households in nairobi city county, Kenya. International Research Journal of Economics and Management Studies IRJEMS, 4(6).
  21. Ogundari, K., & Abdulai, A. (2013). Examining the heterogeneity in calorie–income elasticities: A meta-analysis. Food Policy, 40, 119-128. https://doi.org/10.1016/j.foodpol.2013.03.001
  22. Phetcharat, C., & Chinnakum, W. (2022). Differences in Household Food Demand by Income Category as Evidenced in Rural Thailand(No. 181). Puey Ungphakorn Institute for Economic Research.
  23. Poi, B.P. (2012). Easy demand-system estimation with quaids. Stata Journal, 12(3), 433–446. https://doi.org/10.1177/1536867X1201200
  24. Pollak, R.A., & Wales, T.J. (1992). Demand system specification and estimation. Oxford University Press.
  25. Seale Jr, J.L., Regmi, A., & Bernstein, J. (2003). International evidence on food consumption patterns. Economic Research Service, United States Department of Agriculture. Retrieved from https://www.ers.usda.gov/publications/pub-details/?pubid=47430
  26. Sola, O. (2013). Demand for food in Ondo state, Nigeria: Using quadratic almost ideal demand system. Journal of Business Management and Economics, 4(1), 1-19. https://doi.org/10.5539/jas.v5n2p169
  27. Statistical Center of Iran. (1402). Household Expenditure and Income Report. Tehran: Statistical Center of Iran. (In Persian). https://doi.org/10.52547/jss.15.2.533
  28. Valera, H.G., Mayorga, J., Pede, V.O., & Mishra, A.K. (2022). Estimating food demand and the impact of market shocks on food expenditures: The case for the Philippines and missing price data. Q Open, 2(2), qoac030. https://doi.org/10.1093/qopen/qoac030
  29. Wang, J., Yuan, Z., Wu, Z., Kuang, X., & Ye, F. (2025). Insurance policy and cropping structure adjustment toward staple grains in China: implications for food system resilience and security. Frontiers in Nutrition, 12, 1636296. https://doi.org/10.3389/fnut.2025.1636296
  30. WFP. (2023). Global report on food crises 2023. World Food Programme.
  31. World (2023). Food security update: Recent trends and global outlook. Washington, DC: World Bank.
  32. Zhou, D., Yu, X., & Herzfeld, T. (2015). Dynamic food demand in urban China. China Agricultural Economic Review, 7(1), 27-44. https://doi.org/10.1108/caer-02-2014-0016
Send comment about this article
Enter Name.
Enter a valid email address.
Enter a vaid affiliation.
Enter comments (At leaset 10 words)
CAPTCHA Image
Enter Security Code Correctly.

  • Receive Date 27 September 2025
  • Revise Date 28 December 2025
  • Accept Date 28 April 2026
  • First Publish Date 28 April 2026