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Research Paper | December 4, 2022

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The impact of changes in prices and income on demand patterns for food commodities in Banjarmasin City and Banjarbaru City, South Kalimantan Province, Indonesia

Sadik Ikhsan, Djoko Santoso, Febriyanti Puteri Lestari, Agung Dewi Permatasari

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Int. J. Biosci.21(6), 66-75, December 2022

DOI: http://dx.doi.org/10.12692/ijb/21.6.66-75

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Abstract

Changes in commodity prices and incomes affect the demand for commodity bundles and, in turn, have an impact on the overall pattern of demand for these commodities. Apparent changes in prices and income are indicated to occur in 2019, which was before the COVID-19 pandemic, and 2021, which was the time of the COVID-19 pandemic. The research aimed to construct the demand for food commodities using the LA/AIDS model as well as to analyze changes in the pattern of demand for food through the budget share as well as the price and income elasticity. The study used secondary data from National Socio-Economic Survey in March 2019 and in March 2021 in Banjarmasin City and Banjarbaru City, each with 1,210 and 1,310 samples of households. The results showed that there was a sharp decrease, which was 5.11%, in consumption of the ready foods and beverage (RFB) group. The decline was, among other things, triggered by the emergency response policy for COVID-19 in the form of minimizing movement and crowds of people so that the behavior of consuming RFB outside was reduced or no longer made. Instead, food consumption had been shifting to other raw food groups, such as grains and tubers, eggs and milk, vegetables, fruits, fish, and meat, which was marked by an increase in the budget share of these food groups. This shift in consumption patterns to raw food groups was also indicated by an increase in price elasticity.  It could be interpreted as the seriousness of consumer demand for these food groups.

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