In this study, the authors evaluated how much price changes in food and energy -- two basic living expenditures competing for consumers’ budgets -- would affect consumer welfare. We first estimated a US complete demand system to quantify the interdependent demand relationships among 11...

We develop a measure of consumer welfare by approximating Hicksian compensating variation as a function of all commodity prices and compensated price elasticities. The unique feature of this approach is that all direct- and cross-commodity effects of a demand system are incorporated into the...

We analyze the consumer welfare effects of increased food and energy prices and find that the own-price elasticities of both food and energy are relatively inelastic, which explain well the dynamics of the recent soaring food and energy prices. The estimated demand elasticities are then used to...

American’s nutritional and health status appear to be trending toward healthier diets, as measured by a reduction in cholesterol intake and an increase in calcium intake. The levels of food energy and total fats, however, increased substantially.