Analysis of Food Demand in Peru: Implications for Food-Feed Competition.

In their policy proposals on how best to stimulate economic growth, economists have been increasingly emphasizing free markets. It is, however, possible that free-market-led economic growth can lead to increased income inequity which can further increase poverty. One of the more interesting but thus far insufficiently explored mechanisms for the latter is food-feed competition. Using Peruvian Living Standard Survey (PLSS) data for 1985-86 and 1990, the paper examines the demand patterns of households and concludes that the empirical evidence is in agreement with the hypotheses underlying the theory of food-feed competition. Copyright 1999 by Blackwell Publishing Ltd