important role in supplying the required energy. On the other hand, it is one of the goods, which
Iranian government is about to change its subsidy strategies. To design useful sugar subsidy
strategies, it is necessary to know sugar position in the basket of households and be familiar
with households & apos; sugar demand or consumption behavior. This research estimates sugar demand
for Iranian households by using time series of 1984-2008, which is taken from central bank of
Iran. In this paper, first independent and dependent variables of household sugar demand
model are chosen based on the literature review and theory of demand. Then, sugar demand is
estimated by OLS technique and linear regression. The preliminary statistical observations such
as Durbin-Watson, F statistic and R2 indicate that the regression is admissible. The results seem
plausible and consistent with theory and show that sugar demand in Iranian households is
associated with household expenditure, relative sugar price, family size and indicate that
demand of sugar is affected during the war time. The results also show the income elasticity is
0.8 and price elasticity is -0.2 which means sugar is essential good for Iranian households and is
inelastic to price.
How to cite this paper
Soleimany, N & Babakhani, M. (2012). An econometrics method to estimate demand of sugar.Management Science Letters , 2(1), 285-290.
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University Press.
Weliwita, A. , Nyange, D. & Tsujii H.(2003). Food Demand Patterns in Tanzania: A Censored
Regression Analysis of Microdata. Sri Lankan Journal of Agricultural Economics. 5(1), 9-23.
Wold, H. & Juréen, L. (1953). Demand Analysis: A Study in Econometrics. John Wiley & Sons (2nd
Ed).
Yeong-Sheng, T., Mad Nasir, S., Zainalabidin, M., Amin Mahir A. & Radan,A. (2008). A complete
demand system of food in malaysia. The IUP Journal of Agricultural Economics, 5(3), 17-29.
Agricultural Economics. Agricultural Experiment Station North Dakota State University,
Agricultural Economics Report No. 356.
Gemmill, G. (1980). Form of function, teste and the demand for sugar in seventy-three nations.
European economic review, 13(2) 189-205.
Gemmill, G. T. (1976). The World Sugar Economy: An Econo-metric Analysis of Production and
Policies. Michigan State University, Agricultural Economics Report No. 313.
George, P. & King, G. (1971). Consumer Demand for Food Commodities in the United States with
Projections for 1980. University of California-Berkeley. Giannini Foundation monograph, 26, 1-
987.
Ishida, A., Law, S.H. & Aita, Y. (2003). Changes in Food Consumption Expenditure in Malaysia.
Agribusiness, 19 (1), 61-76.
Keerthipala, A.P. (2002). Impact of macro economic policies on the sugar sector of Serilanka. Sugar
tech, 4 (3 & 4), 87-96.
Koutsoyianis, A. (1979). Modern Microeconomics. London: The Macmillan Press Ltd.
Lewbel, A. (2006). Engel Curves Entry for the New Palgrave Dictionary of Economics. Boston
College. 2nd Ed.
Lopez, R. & Jorge, L. (1985). Sepulveda ,Changes in the U.S. Demand for Sugar and Implications for
Import Policies. NJARE, 177-182.
Rahiji, M. A. Y., & Adewumi, M.O. (2008).Market supply response and demand for local rice in
nigeria: Implications for self-sufficiency policy. Journal of Central European Agriculture, 9(3),
567-574.
Ramasubban, T.A. (1983). An Econometric analysis of consumer Demands for sugar in Tanzania.
The Developing Economies, 21(2), 160-183.
Rustan, R. (2009). Study of factors affecting demand and supply of sugar in Indonesia. Journal of
research in national development, 7 (2).
Sadoulet, E. & De Janvry A. (1995). Quantitative Development Policy Analysis. Johns Hopkins
University Press.
Weliwita, A. , Nyange, D. & Tsujii H.(2003). Food Demand Patterns in Tanzania: A Censored
Regression Analysis of Microdata. Sri Lankan Journal of Agricultural Economics. 5(1), 9-23.
Wold, H. & Juréen, L. (1953). Demand Analysis: A Study in Econometrics. John Wiley & Sons (2nd
Ed).
Yeong-Sheng, T., Mad Nasir, S., Zainalabidin, M., Amin Mahir A. & Radan,A. (2008). A complete
demand system of food in malaysia. The IUP Journal of Agricultural Economics, 5(3), 17-29.