Evaluation of the Unit Value Elasticity Biases in Meat Demand in Urban China

Aggregate data are often applied in meat demand studies,with unit value(ratios of expenditures to quantities)used instead of market prices.Elasticity estimated from unit value can be subject to various quality and then measurement error biases.In this paper,data from 984households in urban China were used to estimate a demand system for pork,beef,mutton and poultry,and the extent of the bias from commonly used market price was evaluated.The results show that the elasticity obtained from unit value overestimate market price elasticity.With higher and higher meat quality standard that urban consumers are demanding for,the bias between unit value and price elasticity is enlarging,so it is more important to evaluate the extent of bias between these two kinds of elasticity.