Testing for pre-committed quantities of Australian meat demand

Abstract

Pre-committed consumption represents the portion of demand that is determined by non-price and non-income factors. This study uses quarterly data to estimate a Generalised Almost Ideal Demand System (GAIDS) to test for the existence of pre-committed meat consumption in Australia. Two specifications are estimated to evaluate the impact of seasonal and time trend factors on pre-committed demand. Evidence is found for the existence of pre-committed chicken consumption when jointly estimated with seasonal and time trend factors. Results support improved demand modelling of Australian meat consumption using the GAIDS and provide insights into how Australian meat demand is affected by price, expenditures, pre-committed consumption, seasonality, and trends.