The Structure of Taiwanese Demand for Meats

Although Taiwanese are not major beef consumers in the world, the growth rate of beef consumption is impressed~ However, three problems have been ignored in the past studies of beef consumption. These problems include developing a analysis of Taiwanese meat demand relating to the effect government policies on imported beef demand, differentiating the quality of qrain-fed beef from that of range-fed beef, and searching for a proxy of the unavailable retail price of imported beef. In this paper, these problems are discussed and solved. In this paper, a new mixed demand system which is derived from an AIDS-like mixed expenditure function is developed and applied to the empirical study. Theoretical derivation and economical properties of the mixed demand system are provided. For an application, we choose the Taiwanese food demand system classified into six food categories: pork, poultry, seafood, US-imported beef, beef supplied from other countries, and other food. The investigated period covers from 1966 to 1991. The nonlinear three-stage least squares instrumental estimation procedure and the generalized inverse technique are applied to the study. Results suggest that the US-beef is luxury meat and it will attract more Taiwan consumers only when its price is lowered.