Research Article
Agricultural Economics
M. Ghahremanzadeh; F. Jafarzadeh; R. Fathi
Abstract
IntroductionFood security and food security are considered important development goals in all countries, so that reducing food insecurity is seen as an important political goal for all people. Accessing this goal can be achieved by increasing food supply, improving access to food, and increasing people's ...
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IntroductionFood security and food security are considered important development goals in all countries, so that reducing food insecurity is seen as an important political goal for all people. Accessing this goal can be achieved by increasing food supply, improving access to food, and increasing people's purchasing power. But evaluating these programs is challenging. In this regard, the purpose of this study is to investigate food insecurity and determine the economic value of food in the country. For this purpose, the analysis of welfare economics proposed by Chavez (2017) has been used. Materials and MethodsThe data and information required in this study include household consumption expenditure for six major food groups: 1- bread and cereals, 2- meats, 3- dairy products, 4- fresh fruits, 5- oils and fats, and 6- fresh vegetables that have been used from the statistics of the raw income-household data questionnaire for 2018. In this study, household demand was estimated using the near-ideal Quadratic Almost Ideal Demand System (QUAIDS) and then the income, compensatory price (Hicks), and non-compensatory elasticities (Marshall) were calculated. Finally, the economic value of food (food benefit) was calculated for the six groups of food under three scenarios: 1- High food insecurity, 2- Moderate food insecurity, and 3- Food security. Results and DiscussionThe results of income elasticity calculations showed that the group of bread and cereals, dairy products, oils and fats, and vegetables are among the essential goods and the meat of luxury goods and fruits have the same elasticity According to the results of compensatory price elasticity (Hicks), all negative own-price elasticities are consistent with economic theory and show a negative relationship between the price of each commodity and the demand for that commodity. In all studied groups, own-elasticity is less than one price and therefore they are less elastic concerning their price. A comparison of the own-price elasticity of demand for the studied goods showed that the absolute value of own-price elasticity is higher for dairy products than other goods and less for meat than other goods. In other words, for a one percent increase in the price of dairy products, the demand for it decreases more than other goods. The amount of cross-price elasticity for all food groups in terms of absolute value is less than one. In other words, in most cases, consumers change the demand of another group less by changing the price of one group. After calculating price and cross-price elasticities, the economic value of food (food benefit) of each urban household was calculated in three scenarios: 1- high food insecurity, 2- moderate food insecurity, and 3- food security. The food benefit of each household in the high food insecurity scenario for the group, bread and cereals are 2903.7 (1000Rials), meat 5947.3 (1000Rials), dairy 5601.4 (1000Rials), fruit 5486.1 (1000Rials), oils and fats 1859.2 (1000Rials) and vegetables 2394.3 (1000Rials). In total, the economic value of food for an urban household with a high level of food insecurity is equal to 24192.0 (1000Rials). While for the food security scenario equal to 77046.8 (1000Rials) has been obtained. Conclusion A comparison of the economic value of the food groups studied in the moderate food insecurity scenario compared to the high food insecurity scenario indicates that the value of food under the second scenario is at least 1.6 times higher than the first scenario and the economic value of meat in the moderate food insecurity scenario has increased more than other food items and the economic value of oils and fats has increased less than other food items. Also, the economic value of selected food groups in the food security scenario compared to the high food insecurity scenario, indicates that bread and cereals are 3.18 times, meat 3.29 times, dairy products 3.22 times, fruit 3.16 times, Oils and fats are 2.94 times and vegetables are 3.11 times. In this case, the economic value of meat has increased more than other foods and the economic value of oils and fats has increased less than other foods. According to the results of food insecurity scenarios, it was observed that household income is the main factor in household food security and food benefit and has the greatest impact on it. Therefore, it is suggested that the goals of policies in the field of supporting low-income groups are to pave the way for increasing the income of this group.
Research Article
Agricultural Economics
H. Hajizadeh; A. Fallah; S. Hosseini
Abstract
Introduction The forest ecosystem is one of the most important natural resources of any country, which provides various functions and services for human beings. Therefore, recognizing the functions and services related to the forest and determining the most appropriate valuation method for them ...
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Introduction The forest ecosystem is one of the most important natural resources of any country, which provides various functions and services for human beings. Therefore, recognizing the functions and services related to the forest and determining the most appropriate valuation method for them is of particular importance. Also, the continuation of using the functions and services of forests requires programs to protect and improve their environmental status. This issue itself requires the participation of stakeholders and finding out about their preferences for forest ecosystem protection and valuing them. But estimating the real value of some functions, ecosystem services and developing appropriate mechanisms to obtain their economic value requires economic valuation methods using non-market methods. Although there are different interpretations of the economic valuation methods of functions and services forest ecosystems but among the various valuation methods, economists have more emphasis on the value of money that is estimated through stated preferences. One of these methods to estimate the stated preferences is the Choice Experiment. Materials and Methods The purpose of this study is to evaluate the preferences and willingness to pay (WTP) of native communities for the conservation of Shiadeh and Diva forest ecosystems of Babol city located in Mazandaran province using the evaluation Choice Experiment (CE) method. The Choice Experiment is a subset of the choice modeling method and the stated preference method family. Choice modeling is based on Lancaster's value theory and random utility theory. Also, Shiadeh and Diva forests are one of the green areas with all kinds of forest covers, plants and valuable trees and as one of the useful and valuable resources for the residents of the region. These forests play an important role in the lives of the forest dwellers, herdsmen and villagers on its outskirts. Also, Shiadeh and Diva forests because of the presence of natural forest ecosystem, beautiful landscapes, unique vegetation and diverse animal species, as well as special human and cultural effects, are always one of the centers of interest. This forest ecosystem is very valuable and can provide services for the residents of this area. Therefore, in this study, the statistical population of the study includes 150 native households in the villages of Shiadeh and Diva forests. In the study, research data were completed and collected by field sampling in the summer of 2020 by native communities of the region. Socio-economic variables include eight variables: age, marriage, gender, job, household size, education, income and household expenditure. The effect of these variables on the WTP of communities was surveyed. In this study, the WTP of individuals for the forest ecosystems conservation was estimated by the CE method and conditional logit model. To validate the conditional logit model, the independence of irrelevant alternatives (IIA) was performed using Hassman-McFadden statistic. Also, a multinomial logit model was used to investigate the effect of socio-economic variables on the WTP.Results and Discussion In this study, the reliability of the questionnaire was calculated using Cronbach's alpha test and was obtained as α=0.87, which indicates its reliability. WTP of each household for the conservation of Shiadeh and Diva forest ecosystem services, including regulatory, habitat and information services, from the status quo to the improvement situation was equal to 1020.68, 630.25 and 1026.49 thousand Rials per month, respectively. The study results showed that WTP native communities for the forest ecosystem conservation to provide regulatory services and its improvement is the first priority, and habitat and information services took the next positions.Conclusion The aim of this study was to evaluate the preferences and willingness to pay (WTP) of native communities for the conservation of Shiadeh and Diva forest ecosystem using the evaluation Choice Experiment (CE) method. In general, it can be concluded that regulatory services was the most important forest ecosystem services in terms of native communities in the region. Also, the final WTP of native communities' estemated at 33329.04 Rials per year (2777.42 Rials per household per month).Therefore, considering the great importance of the regulatory services of Shiadeh and Diwa forest ecosystem, such as water protection, soil protection, carbon sequestration and climate regulation, etc., it is suggested that relevant institutions such as the country natural resources and watershed management organization, the general department of natural resources of the province Mazandaran, regional water organization and agricultural Jahad organization allocate the necessary investments for the protection of Shiadeh and Diwa forests, and implementation of projects such as forest management projects, water protection, soil protection, species protection flora and fauna of the region projects, etc.
Research Article
Agricultural Economics
A. Fatahi Ardakani; F. Sakhi; Y. Bostan; M. Rezvani
Abstract
Introduction Various studies have shown that changes in rainfall due to climate change can affect the stability of food supply and in fact climate change by increasing the prevalence and severity of drought or flood, crop yields, food access and also effect food prices. According to the FAO, Iran's ...
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Introduction Various studies have shown that changes in rainfall due to climate change can affect the stability of food supply and in fact climate change by increasing the prevalence and severity of drought or flood, crop yields, food access and also effect food prices. According to the FAO, Iran's food security rank is 82 out of 125 countries in the world, and one of the reasons for this rank is the excessive waste of agricultural products in Iran. As a result, citing a wide range of previous studies, it has been documented that the impact of climate change on food security for countries that are more dependent on agriculture is largely negative and has significant effects. Therefore, in present study, citing theoretical foundations and foreign and domestic studies conducted in the field of food security especially in Iran, factors such as food prices, climate change, household income, exchange rate and targeted subsidy policy as factors affecting selected food security and their effect on food security of urban households in Iran were studied.Materials and Methods In this study, it was our goal to find the effects of food price variables, climate change, household income, exchange rate and targeted subsidy policy on food availability by estimating single equations of the food security index.In this study, based on the subject literature and available information, the self-explanatory model with wide intervals (ARDL) and the error correction model (ECM) introduced by boys and colleagues have been used to examine integration and estimate short-term and long-term relationships between variables. Data required for the present study, regarding the open market exchange rate and food prices (food and beverages) from official statistics based on the annual reports of the Central Bank of the Islamic Republic of Iran and the necessary information to calculate the food security index of households and average household income from detailed results Expenditure and income of urban households of the Statistics Center of Iran, for the period 1398-1399 has been extracted.Results and Discussion The results showed that in the long run, a one percent increase in food prices reduces the food security index of Iranian urban households by 21 percent. As expected, the coefficient of variable climate change has a negative and significant effect on the food security index, and with its increase, the production of food and agricultural products decreases, and as a result, the food security index decreases. The growth rate of free market exchange rate with a negative sign at the level of one percent is significant. Since the agricultural industry in Iran is an industry highly dependent on imports. As a result, the increase in the exchange rate increases the price of agricultural products and affects food security. Annual household income has a positive and significant effect on household food security index. By increasing household income and assuming its appropriate distribution in society, it can be concluded that urban households are faced with increased purchasing power and ability to meet their food needs, and this variable has a positive effect on energy status and food security. The virtual variable of the years of implementation of the law on targeted subsidies is also significant at the level of 10% with a negative sign. The results show that in the long run, the implementation of this law has reduced the activity of farmers due to rising prices of agricultural inputs and energy carriers, this issue leads to a decrease in domestic food production and thus increases their prices and ultimately reduces food security of households. The estimated coefficient of ecm (-1) is equal to the negative value of 0.42 and is statistically significant at 1% probability level. The value of this coefficient indicates that each year 0.42% of the imbalance of one period of food security of urban households in Iran in the next period is adjusted.Conclusion Given the negative effect of food price index and exchange rate on food security of urban households, the application of appropriate exchange rate policies can be very effective in reducing inflation, especially food price inflation, which threatens the country's food security. With increasing investment, domestic food production is approaching self-sufficiency in this sector, in which case food prices will be subject to domestic supply and demand, and to some extent will be protected from exchange rate fluctuations and food imports, and this will create food security and prosperity. The economy in the country will help a lot. Given the negative effect of targeted subsidies, a review of the implementation of targeted subsidies policy to establish food security for households is proposed. To reduce the negative effects of climate change on food security, selective strategies must focus on addressing the adverse effects of climate change and food insecurity. Educating and strengthening public belief in climate change and water crisis, formulating long-term and short-term plans and policies for water resources management under climate change conditions with the participation of all relevant organizations and moving towards modern methods can be effective in reducing the effects of climate change.
Research Article
Agricultural Economics
R. Heydari
Abstract
IntroductionMeat is one of the most important sources of animal protein and plays an important role in human nutrition. In addition, meat is one of the main commodities in the basket of Iranian households, so that it included about 20% of food costs in Iran. In recent years, fluctuations in meat prices ...
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IntroductionMeat is one of the most important sources of animal protein and plays an important role in human nutrition. In addition, meat is one of the main commodities in the basket of Iranian households, so that it included about 20% of food costs in Iran. In recent years, fluctuations in meat prices have always been one of the main challenges of the meat market of Iran and every year the imbalance in its market reduces the welfare of consumers and causes damage to producers. In the current situation where the Iran foreign exchange resources are limited and prices of the meat market has many fluctuations, examining the price drivers of meat price in Iran from the perspective of microeconomics and especially the chain of vertical price transmission can be a good guide for policymakers and planners in adopting appropriate policies to control prices and domestic consumption of these products. The purpose of this study is to identify the drivers of the price of meat different types in Iran using the Panel-SVAR model in 30 provinces of the country during the years 2006-2019. Materials and MethodsWe use the panel SVAR methodology developed by Pedroni (2013) to analyze the implications of shocks on the price of meat types. Defining zπt ≡ (yππ‘, xππ‘, sππ‘, mππ‘)′, the heterogeneous panel SVAR model can be formulated as:π΅π zππ‘ = π΄π (πΏ) zππ‘−1 + , π = 1,…,, π‘ = 1, … , π and π’it ∼ (0,Σπ)Where π΅π is the matrix of structural parameters, reflecting the instantaneous relations among model variables, π§ππ‘ is the vector of endogenous variables, (πΏ) is a polynomial of lagged coefficients for ith province. π’ππ‘ ≡ (π’π¦ππ‘, π’xππ‘, π’sππ‘, π’mππ‘)′ is the vector of the structural shocks or innovations in π§ππ‘, the variance-covariance matrix Σπ is diagonal. Assuming π΅π be an invertible matrix, pre-multiply both sides of Equation (1) by , we get the reduced form VAR model:π§it = Ππ (πΏ) π§it−1 + πit where Ππ (πΏ) = π΄π (πΏ), πππ‘ = π’ππ‘ and πit ∼ (0,Ωπ)Moreover, the variance-covariance matrix Ωπ of the reduced form error πππ‘ = (ππ¦ππ‘, πxππ‘, πsππ‘, πmππ‘)′ is full rank and no diagonal. The reason is that the errors are correlated between equations, implying that the innovations are not orthogonal. Traditionally, when this happens, innovations are correlated with each other and the matrix Ωπ can be orthogonal zed by structural Cholesky decompositions. This method imposes an economic structure and allows the specific ordering of the panel SVAR variables. Finally, the contemporary matrix π΅π is of the following form:Bi = Results and DiscussionThe results of Pedroni and Cao co-integration test showed that the hypothesis of no co-integration among the variables could not be rejected. The optimal lags length for the Panel-VAR model, using the criterion of Schwartz-Bayesian, was determined as 2. The unit root test of the circle also showed that the estimated Panel-VAR model provides the stability condition. The results of Panel-VAR Granger causality test also showed that there is a direct or indirect causal relationship between all the studied variables. The results of estimating the "matrix of long-term response function in the Panel-SVAR model showed that all estimated coefficients are significant. The results of the Impulse Response Functions (IRFs) showed that the effect of shocks of the value added of the agricultural sector in the agricultural sector on meat price index, mutton price and beef price is negative and on chicken price is positive, while the shocks effect of the price index of imported inputs (corn, soybean meal and barley), livestock prices and meat prices are positive on meat price changes (chicken, sheep and beef). The maximum and minimum effect of these variables occurred between the first to the fifth period and their effect pattern is sinusoidal, afterwards shocks continue to be almost constant (or with low amplitude). This result shows that the effect of shocks of meat price stimuli in Iran is continuous and stable. The results of analysis of variance and historical decompositions also showed that the shocks related to the value added of the agricultural sector have the least effect and the shocks of the meat price variable have the greatest effect on meat price changes in Iran. The results of analysis of variance and historical analysis also showed that the shocks related to the value added variable of the agricultural sector have the least effect and the shocks of the meat price variable itself have the greatest effect on variation of meat prices in Iran. This result indicates that the impact of agricultural shocks on the meat price of is relatively weak, in contrast, the impact of shocks of the price transmission especially in the short term (beginning of periods) play a vital role.ConclusionIn this study, impulses effect of four variables of the value added of agricultural sector, price index of imported inputs (corn, barley and soybean meal) and livestock price (live chicken, live sheep, live calf) was examined in four channels (equation) of price including meat price index (Total meat market), chicken, mutton and beef using the Panel-SVAR model in 30 provinces during the years 2006-2019. The findings of this study showed that the most important cause of price fluctuations in the Iran meat market is due to shocks to the vertical price transmission channel, especially in the short term. Therefore, preventing from price shocks in the Iran meat market will be one of the most important tools to create efficiency in the market of this product. Managing inflation expectations is a good way to reduce the price of meat in Iran. In addition, the use of appropriate protectionist policies throughout the meat production, distribution and consumption chain, such as monitoring the production, distribution and consumption stages; modify market structure instead of price control; timely provision of production inputs for producers; development of livestock inputs in the country; providing the supply of meat in the stock market; adequate and timely distribution to consumers; cash payments are offered to households and meat producers in the event of price shocks and explosions, is suggested.
Research Article
Agricultural Economics
S. Naghavi
Abstract
Introduction In today's world, energy plays a prominent role in various economic and political fields. A role that has plagued many countries with a monopoly economy and its effects, and has left others with costly problems caused by rising energy prices, and in general, even international relations ...
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Introduction In today's world, energy plays a prominent role in various economic and political fields. A role that has plagued many countries with a monopoly economy and its effects, and has left others with costly problems caused by rising energy prices, and in general, even international relations and disputes has made an impact. Accordingly, communities are looking for ways to reduce energy consumption without harming their economic growth. Due to the shortage energy resources and its role in economic growth, its optimal use is an important goal in the economic development of each country. Therefore, it is necessary to know the factors affecting changes in energy consumption, which requires the decomposing of energy consumption into different factors affecting changes in energy consumption. In the present study, the factors affecting energy consumption are analyzed using statistics and information of industry and agriculture sectors during the period 1397-1387 to three factors: structural effect, activity effect and energy intensity effect. The relationship between energy consumption and GDP growth in these two sectors has been studied to determine which factor has the greatest role in energy consumption changes in industry and agriculture and to suggest appropriate policy solutions.Materials and Methods Decomposing Analysis is one of the most widely used approaches in analyzes related to energy consumption and CO2 emissions. It is concluded that one is structural analysis (SDA) and the other is index analysis (IDA). These two analysis techniques are different and each has advantages and disadvantages. The SDA technique is more complex and requires a lot of data. On the other hand, the data-output table is prepared every few years and annual data are not available. Instead, more information and findings are obtained using the SDA technique. The IDA technique is simple and does not require much data. It can be used with big data and does not need the data of any particular department or product. For this reason, the SDA technique has been used more. This study is used the Tapio decoupling index to explain the decoupling status. Decoupling index is the best technique to describe the dependence of economic growth on energy consumption and it is used to discover the relationship between energy consumption and economic growth. In the present study, using the Logarithmic Mean Division (LMDI) index, to analyze the factors affecting energy consumption in industry and agriculture and then using the decoupling index to examine the relationship between energy consumption and GDP growth in these two sections are discussed.ResultsThe results of the decomposing of energy consumption from GDP in the industrial sector showed that in most of the studies on the effect of energy intensity in agricultural sector, the effect of production had the greatest role in the decompose of energy consumption from GDP.ConclusionThis study examined the decoupling of energy consumption from GDP of the industrial and agricultural sectors and the factors affecting energy consumption for each sector in Iran. The results of decomposition of energy consumption from GDP in the industrial sector showed that in most of the studied years, the effect of energy intensity and in the agricultural sector, the production effect had the greatest role in decomposing energy consumption from GDP. In 2010 and 2016, the production effect had a negative effect on energy consumption and increased energy consumption. In 1394, the index of decoupling of energy consumption from the growth of the agricultural sector was the best and most ideal possible, strong decoupling, and this indicates that the growth rate of the agricultural sector was higher than the growth rate of energy consumption. This year, the effect of energy intensity has had a positive effect on reducing energy consumption. The composite index has not experienced much fluctuation. Different modes of decoupling index and factors affecting energy consumption in industry and agriculture can be used as evidence for countries efforts to strongly decoupling and save energy in industry and agriculture. Advances in technology and innovation can reduce the growth dependence of sectors on energy consumption. Also, attention should be paid to optimizing the economic structure to create economic stability and reach the ideal state of the decoupling index.
Research Article
Agricultural Economics
Sh. Zarif Moradian; M. Sabouhi Sabouni; M. Daneshvar Khakhki
Abstract
Introduction Given the growing global hunger in recent years, creating and increasing resilience among disadvantaged and impoverished communities, emphasized in the 2030 Sustainable Development Agenda, is a significant concern to most countries. The term resilience is generally considered as the ...
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Introduction Given the growing global hunger in recent years, creating and increasing resilience among disadvantaged and impoverished communities, emphasized in the 2030 Sustainable Development Agenda, is a significant concern to most countries. The term resilience is generally considered as the capacity of a system to withstand various risks, and household resilience can be defined as the ability to return to the previous level of living conditions after a shock. Since one of the most critical shocks that farmers have faced in Iran is drought, the present study aimed to estimate the effect of drought on rural farmers’ household resilience in a selected village in Qalandar Abad district in Iran. Materials and Methods The factor analysis method was used to estimate the components of the Resilience Index Measurement and Analysis (RIMA) of the Food and Agriculture Organization of the United Nations (FAO), and the Mimic (Multiple indicators_ multiple causes) method was used to estimate the latent variable of resilience. RIMA, which considers resilience as a latent variable, includes four main components of Access to Basic Services (ABS), Assets (AST), Social Safety Nets (SSN), and Adaptive Capacity (AC). Also, according to the purpose of the study on estimating the resilience of rural households with the MIMIC method, at least two food security indicators at the household level, as multiple indicators of resilience, are required. The food security indices used in the calculations of this study include the Household Hunger Scale Index and the household Food Consumption Score. The samples included 149 farmers randomly selected from Hossein Abad Rekhneh Gol village, and data were collected through interviews with the household head. To reveal the effect of different shocks on the rural resilience households, self-reported information such as drought, livestock loss, and the characteristics of the households were used through an Ordinary Last Square regression. Results and Discussion In the first stage, each of the pillars of resilience, including Access to Basic Services, Assets, Social Safety Nets, and Adaptive Capacity, which are considered latent variables, shows a higher correlation between the variables, and the calculated pillars indicate the greater importance of that variable in each of the resilience components. According to the results, among the variables that constitute the pillar of access to basic services, "the distance from the household to the health center" variable correlates with this pillar, which indicates its high importance. In addition, the "attending school years" is one of the most important variables in forming and creating the adaptive capacity of a household to the crises ahead. The agricultural water availability and the total yield during a year play an important role in creating the asset pillar. Regarding creating the social safety nets pillar, as we expected, the governmental cash transfers, through monthly subsidies, the Imam Khomeini Relief Foundation, and the State Welfare Organization of Iran, is the most crucial variable. The results obtained from the food consumption (FCS) score index showed that 117 out of 149 studied households are within the acceptable threshold, 28 households are on the borderline, and four households are in a poor food consumption situation. The Hunger Scale Index showed that out of 149 households, 62 households are on the little to no hunger threshold, while 81 households are on the moderate hunger and six households are on the severe hunger threshold. Also, based on the results of the MIMIC model, among the calculated pillars, household assets is the most important. The increase of one standard deviation unit in AST will increase 0.06 standard deviation units in the resilience capacity index. Adaptive capacity and social safety nets pillars also play a significant role in creating resilience for rural households. Thus, increasing one standard deviation in the AC and SSN led to an increase in the magnitude of the resilience by 0.04 and 0.03 standard deviations, respectively. Finally, the effect of different shocks on the rural resilience households showed that variables such as drought, livestock loss, and gender of household head (being female) have a negative effect on their resilience. The size of the household has a positive impact, which means that the more family members, the more resilience. Conclusion One of the critical goals of underdeveloped and developing countries, is to eradicate poverty and achieve sustainable development. In Iran, like other developing countries, smallholder farmers are known to be vulnerable to environmental and economic changes such as climate change, rising prices of agricultural inputs, etc. Therefore, adopting and implementing policies that lead to a fair income distribution for vulnerable people is essential. Estimating the RIMA makes it possible to rank households based on their strengths, weaknesses, and current needs. Budget allocation and the policy time duration are two limiting factors that may optimize using the RIMA results. The present study examined the RIMA and the effect of drought on the calculated index for the first time in Iran for a specific region. Since the ranking of households based on resilience requires awareness of all vulnerable households' situations, the definition of short-term and long-term projects in the future development plans is essential. To identify "the most vulnerable groups" and "the most important challenges and shocks," these scheduled projects are vital for budget allocation prioritization.
Research Article
Agricultural Economics
E. Barikani; A. Amjadi
Abstract
IntroductionSurvey of the households demand is very important and necessary in planning for production of various goods and services in order to regulate the domestic consumption, import and export. Given the importance of this issue, the study of consumer behavior and their consumption pattern is a ...
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IntroductionSurvey of the households demand is very important and necessary in planning for production of various goods and services in order to regulate the domestic consumption, import and export. Given the importance of this issue, the study of consumer behavior and their consumption pattern is a major part of economic research with the objectives of analyzing the consumption structure, identifying appropriate patterns for explaining the consumer behavior, predicting consumption and its changes. The main objective of the present study is to investigate the consumption and demand behavior of basic food items (cereals, livestock, poultry, fish and shrimp and its products, dairy products, oils, fats and butter, fruits, pulses, sugar and vegetables) in urban areas of Iran using pooled data and SURE method.Materials and MethodsAccording to the objectives of this study, the best functional form of demand should be identified to explain the consumption behavior of urban households in Iran. Therefore, first the Generalized Ordinary Differential Demand System (GODDS) using the data of urban households (pooled data) was estimated using the seemingly unrelated regression (SURE) method and then, the appropriate functional form was selected. Then, according to the appropriate functional form, price and income elasticities were calculated by applying the conditions of adding up, homogeneity and symmetry for each of the equations of the demand system. Therefore, in order to choose and determine the appropriate functional form for food demand system, Generalized Ordinary Differential Demand System (GODDS) was estimated. The above model includes the Rotterdam demand system, differential form of AIDS, and the two hybrid models NBR and CBS. The selection of a suitable functional system is based on the constraints applied based on the θ1 and θ2 parameters. The system of demand equations was estimated using the seemingly unrelated regression (SURE) method. Also, in order to be consistent with the theory of utility, the constraints of adding up, symmetry and homogeneity were applied as linear equations. In order to investigate the impact of drought and also the targeted of subsidies, two dummy variables were included in the model. In other words, the first dummy variable was entered into the model to investigate the impact of drought in 2008. The second dummy variable was entered in order to investigate the effect of targeted subsidies in before and after 2010. In order to better understand household consumption pattern and cost situation and to analyze income, price and cross-demand elasticities, and the deciles were divided into three main groups. In other words, the average of the first three to the third decile was placed in the first group. Also, the average of the fourth, fifth, sixth and seventh decile in the second group and the mean of the eighth, ninth and tenth deciles were in the third group. Accordingly, in this study, the data used are pooled. The required data of research were gathered from the Statistics Center of Iran for the period 2006 to 2017.Results and DiscussionBased on the results of the Wald test, the functional form of AIDS was selected against others. Price elasticity calculation results showed that own-price elasticity of food demand in urban areas is negative. Also, the highest own-price elasticity of food demand was related to fish and shrimp and its products (-1.03). The positive cross- price elasticity of food indicates that there is not necessarily a two-way substitutional relationship between food items and only in some cases (such as cereals and pulses), there is a substitutional relationship. Most positive cross-price elasticities have low values, indicating a poor substitution between food items. The calculation of income elasticity indicates the normality of commodity groups. The income elasticity of fish and shrimp and its products is greater than one that illustrates the luxury of this food.ConclusionCalculating the self-price elasticity of food in urban areas indicates the high elasticity of fish and shrimp and its products. Also, the income elasticity of fish and shrimp and its products has been more than one, which indicates the luxury of this food in urban areas. Therefore, pricing and subsidy policies should be set in such a way as to ensure a minimum consumption of animal protein for each individual in the community. Also, the policies governing the production and supply of the group (cereals, oils, fats and butter, fruits, vegetables, pulses and sugar) as well as the policies governing their consumption should be regulated in some way that the minimum supply of foods is to be possible for households.