Demand for animal source of food in Central Java, Indonesia

Consumption of protein was often used as an indicator of household welfare. This study analyzed the impact of price andincome changeon demand foranimal food in rural households in Central Java, using the Quadratic Almost Ideal Demand System model approach. The research data used data from the National Socio-Economic Survey, totalling13, 872 households. The output appeared that a one percent increase in animal food prices reduced the demand for eggs, chicken, beef, fish, and milk by 0.505%, 1.281%, 4.099%, 3.424%, and 1.915%, respectively. The most elastic animal food group is beef, followed by milk, fish, chicken, and eggs with income elasticities of 3.278%, 2.339%, 2.156%, 1.411%, and 0.556%. All animal food is a luxury item except eggs, which are normal goods. Beef is a substitute for fish, chicken, and eggs, while milk is complementary. The price policy is more effective compared to the income policy for rural Central Java. Rural households in Central Java very responsive to changes in price.


Introduction
Food security can be seen from three aspects: food availability, access to food, and food absorption [1,2,3,4]. The aspect of food absorption is related to nutritional status, which can be seen from the adequacy level of energy and protein consumption. Nutritional status is an important thing that is one of the Sustainable Development Goals (SDGs) goals, namely ending hunger, achieving food security, and proper nutrition [5,6]. A person's nutritional status is influenced by the quantity and quality of food consumed. Even though an area has food availability, it does not mean that it can properly meet energy and protein consumption. This is because people's purchasing power influences the level of public consumption. The people's purchasing power cannot be separated from the price of the goods consumed and the income of the people [7,8,9].
The March 2019 National Socio-Economic Survey shows that the average daily per capita calorie consumption in Central Java Province is 2,045.63 kcal and protein consumption of 62.34 grams/cap/day. This figure is below the national calorie adequacy rate of 2,150 kcal and the protein adequacy rate of 57 grams/cap/day. Based on the area of residence, the average calorie consumption in rural areas is 2,062.67 kcal, higher than that of urban areas, which is 2,029.63 kcal. The average per capita protein consumption for Central Java Province in 2018 was 60.61 grams. This value is lower when compared to other provinces such as DKI Jakarta Province (72.49 grams), Yogyakarta Province (70.18 grams), South Kalimantan Province (67.83 grams) and West Java Province (64.82 grams). The level of protein consumption per capita in Central Java is lower when compared to several other provinces.On the other hand, the amount of food availability in Central Java is higher. Based on the Research on-demand systems using the Quadratic Almost Ideal Demand System (QUAIDS) model approach has been carried out in various countries, including in South Africa [10,11,12], in Nigeria [13,14,15], in India [16], and in Ethiopia [17,18], in Italy [19], and also in Indonesia [20,21,22]. Therefore, this research was important to analyze the impact of changes in the animal source of food prices on demand in rural Central Java. Through the QUAIDS analysis results, the price and income parameters for each animal source of food commodity obtained. These parameters were used to calculate price and income elasticity. With price and income elasticity, valuable information can be obtained about the purchasing power and household consumption patterns of animal source of foods. Through price elasticity, it will be known whether animal source food is elastic, inelastic, and unitary elastic. Through income elasticity, it is obtained whether animal source food is a luxury, normal or inferior. The research results are expected to be used to formulate policies on how reasonable animal source of food prices are so that prices are stable so that animal protein consumption can be fulfilled immediately.

Modelspecification: quadratic almost ideal demand system (QUAIDS)
The foremost common method in demand analysis within two decades is the AIDS model [22,23]. The AIDS model showsa number of a fewdemand properties such as testing for symmetry and homogeneity through linear restriction among the goods [24,25]generalized the AIDS model show bydemonstrating the fitting frame for some consumer inclinations is quadratic contradictory to the linear frame within the fundamental AIDS. Furthermore, the QUAIDS demonstrates keep upthe hypothesisconsistency and the demand properties of the AIDS model.Formally, the share conditionsof QUAIDS model [26,27,28]is: Where is a household's expenditure share for goods i, is constant, is expenditure parameter coefficient, is price parameter coefficient, m is total expenditure, is quadrat parameter coefficient of animal foods, and it is defined as On the other hand, the demand theory of the AIDS also QUAIDS requires the following restrictions: The QUAIDS model in this considerwas carried out to account socio-demographic (z)impactsto the animal food consumption demand. Statistic components can impacthousehold behaviour in terms of demand and allocation of expenditure among goods [29,30]. The 'demographic scaling' method was used to take into account in this study [33].In this approach, the impactsof a alteron the socioeconomics are closed to the impactsof the price changingof animalnourishment [34].
Considering z as a vector of household characteristics z may be a scalar reflectedthe household measurementin the simplest case. Let ( , ) reflectedon the consumptionfunction of a reference household with just a single grown-up.For each household, the use ofRoy's strategy on expensefunction of household characteristics, without controlling for any changes inexpense designs. The second term control for a replacementin relative prices and actual products consumed. Where is a vector of parameters of assessment.The expenditure share expenditure equation takes the following form: In equation 6, mo is a total expenditure, z is utility.
The uncompensated (Marshallian) price elasticity ( ) for the animalsource of protein group with respect to changes in the price of animal product group good is: The expenditure (income) elasticity ( ) for the animal product group is: The compensated (Hicksian) price elasticity ( ) are derived from the Slutsky equation: Where wi is a budget share of the animal source of protein, p is a price, α, γ, β, ῄare parameter coefficient of the constant, animal food prices, income/expenditure, and income square. All the lowercase Greek letters other than are the parameters to be estimated. The demographic variable was finally used in this research, namely rural.The parameters are estimated by iterated feasible generalized non-linear least which are equivalent to the multivariate normal maximum likelihood estimator for this class of problem via Stata's 'nlsur' command as suggested by [33].After the presentation of the demand model, it is worth discussing at least two major data issues, namely the price measure and the treatment of outliers and missing values.

Data
The data utilizedin this studyis secondarydata of National Socio-economics Survey(Survei Sosial Ekonomi Nasional/SUSENAS) data(March 2016). The data analyzed were socio-demographic data(household residence status, household consumption and expenditure of all animal foods, and total expenditure). The animal foods watched in this consider were five animal food groups, i.e.eggs (broilerchicken eggs, localchicken eggs, and duck eggs), chicken (localchicken meat and broiler chicken meat), beef, fish (fresh fish and shrimp including fish, shrimp, squid, and shellfish), andmilk (milk powder and infant milk). This research is specifically for rural households.The sample of this research was13,872households. Table 1 shows the Marshallian own and cross-price elasticities. Marshallian own-price elasticity was negative. This is by the economic theory that an increase in prices reduces demand. In rural Central Java, beef is the most elastic with a demand elasticity of 4.142%. Other animal foods have the following elasticities: fish (3.474%), milk (2.079%), chicken (1.687%), and eggs (0.842%). This shows that households in rural areas are more sensitive to changes in the price of beef.These results are consistent with research[34]. Cross price elasticity shows the relationship between animal foods, whether they are substitution or complementary. If positive, it means that there is a substitution relationship between animal food. Conversely, if it is negative, it means that there is a complementary relationship between animal foods. Central Java rural communities have cross-price elasticities that are mostly positive. This means, in general, there is a substitution relationship between animal foods, only eggs are complementary. In other words, households in rural Central Java consume only one animal food group, and only eggs are consumed together with other animal foods. In rural areas, a 1% increase in the price of chicken meat will increase beef consumption by 1.89% and fish by 1.05%.

Marshallian (uncompensated) own and cross-price elasticities
Meanwhile, when there is a 1% increase in beef prices, it causes an increase in fish consumption by 0.556%, chicken meat by 0.11%, or eggs by 0.02% and decreasing milk consumption by 0.225%. This means that beef is a substitute for fish, chicken, and eggs, complementary to milk. It can be concluded that household preference in rural Central Java increases in animal food such as chicken or beef, and households will switch to consumption of other animal food groups, namely eggs and fish groups.

Hicksian own and cross-price elasticities
Hicksian (compensated) price elasticity is the price elasticity when there is only a price change effect. Table 2 presents the Hicksian price elasticities, both own and cross elasticities. The most elastic Hicksian own-price elasticity was beef with an elasticity of 4.099%, followed by fish (3.424%), powdered milk (1.915%), chicken (1.281%), and eggs (0.505%). A 1% increase in beef prices reduced demand by 4.099%. This decrease is much more significant than the increase in prices. This means that the increase in prices has a more significant effect on decreasing demand. Among these five food groups, the most sensitive to price changes is beef. It can be interpreted that when there is a price increase, rural Central Java households respond quickly in reducing beef consumption.
All cross-price elasticities of the Hicksian cross are positive except for milk with beef. It can be interpreted that the animal source of food is a substitution. In other words, an increase in the price of one animal source food increases the demand forother animal sources of food. Meanwhile, beef and milk have a complementary relationship. This finding is interesting because there was only one complementary commodity. Beef is the most elastic among all animal sources of foods. At the same time, milk was also elastic but had the third elasticity after beef and fish. The increase in the price of milk reduced the demand for milk by 1.915% and reduced the demand for beef by 1.039%. An increase followed this decrease in demand in demand for chicken meat by 0.301%. The increase in milk prices in addition to reducing milk consumption, but also reduces the consumption of beef, and the two commodities were replaced by chicken. It can be concluded that households in rural areas of Central Java consume chicken if there is an increase in the price of milk and beef. The 1% increase in the price of beef increased the demand for fish, chicken, and eggs by 0.587%, 0.131%, and 0.027%. The beef was a substitute for fish, chicken, and eggs, while with milk, beef is complementary. The increase in the price of chicken increased the demand for fish by 1.674%, powdered milk by 1.227%, and eggs by 0.340%. Almost all animal foods are substitutes. This can be interpreted that almost all households in rural Central Java consume only one group of animal foods, not simultaneously because of all other animal foods. This result implies that animal food price policies are needed to stabilize prices and not experience significant increases. This was because the price increase caused a decrease in the consumption of animal food as a protein source.

Expenditure elasticity
Expenditure (income) is an important factor in the demand for goods and services. Community income is not only used to meet food needs but also non-food. The average consumption expenditure of each resident in Central Java in 2016 was IDR 756,720/month. With a food consumption rate of 49.73% and non-food as much as 50.27%. Based on the area of residence, the level of consumption in urban and rural communities is presented in Table 3.Theaverage per capita expenditure in rural Central Java was recorded to be lower than in urban areas where the average per capita expenditure in urban areas was IDR 937,525, while in rural areas, it was only IDR 720,034. The rural community spent more on food consumption (53.17 %), while the rural community expenditure for non-food consumption was 46.83%. After knowing the proportion of people's food consumption, an important factor is how the demand for animal food occurs when income changes. Table 4 shows the income elasticity of eggs, chicken, beef, fish and milk for rural households in Central Java Province. All income elasticities are positive, it means that the increase in income increases the demand for animal food for rural communities. The highest income elasticity of beef was with an elasticity of 3.279%. This means that the increase in household income of rural communities causes people to tend to consume beef compared to other animal foods.
Eggs are inelastic with a low-income elasticity of 0.556% in rural Central Java. The results of the analysis show that eggs are a normal item and are a basic necessity for rural people in Central Java. Chicken, beef, fish and milk were luxury items. In rural areas of Central Java, the most elastic animal food was beef at 3.278% followed by milk, fish and chicken with elasticities of 2.339%, 2.156% and 1.411%, respectively. Seeing that animal food is very elastic in rural Central Java, this means that an increase in income causes the demand for animal food in rural communities to increase.

Conclusions
This paper focuses on analyzing the impact of price and income changes on demand for animal food in rural Central Java. The demand system approach uses the QUAIDS model with parameter estimation using Iterated non-linear SUR. The results showed that the Marshallian and Hicksian demand for beef and fish were the most elastic for rural households in Central Java. The one percent increase in animal food prices reduced the demand for eggs, chicken, beef, fish, and milk by 0.505%, 1.281%, 4.099%, 3.424%, and 1.915%, respectively. For rural communities, beef is a substitute for fish, chicken, and eggs. The income elasticity of rural households in Central Java shows that the most elastic food group is beef, followed by fish, milk, and chicken with elasticities of 3.278%, 2.156%, 2.339%, and 1.411%, respectively. Beef, chicken, fish, and milk are luxury goods, and only eggs are a normal good. For rural households in Central Java, the price policy is more effective than the incomepolicy.