Can China Stomach What's in Store for Them?

Abstract: As incomes in China have grown, their consumption bundles of food products have changed. Through the use of quadratic and linear Almost Ideal Demand Systems for official Chinese governmental provincial panel-data, this thesis examines consumer demand for various food products in rural and urban areas in China from 1995 to 2011. Additionally, a survey was handed out to university students in Shanghai and Beijing in order to complement the official data, and to make comparisons. Results for Chinese urban areas show that food consumption bundles are changing towards less staple goods and more meat, fruit, and vegetable consumption. While for rural areas, staple food consumption still dominates, however, results are less certain due to unreliable data. The survey mostly supported the findings from the official data, and also gave additional information such as indicating increasing consumption of non-traditional food products, such as dairy and fast-food.