Analysis of Household Demand for Chicken Meat in Yogyakarta

Abstract

One of the important food commodities in Indonesia is chicken meat. Approximately 79% of the entire Indonesian population consumes chicken meat for their daily consumption. This study was conducted in Yogyakarta which is a mini of Indonesia, where the population is heterogeneous, many migrants from all over Indonesia live there. An Almost Ideal Demand System (AIDS) model is used to examine household behaviour in Yogyakarta using household social and economy survey data for the period of 2017. The empirical results indicate that estimated elasticity of chicken meat is found to be price inelastic. The study revealed that there is an inverse relationship between the household expenditure and the budget share of chicken meat, a direct relationship between the price of chicken meat and its budget share. The result can have important implications for maintaining the stability of price and availability of chicken meat in meeting the demand for chicken meat.