Weak Separability Testing And Estimation Of Meat Demand System In Iran (Application Of Rotterdam Demand System)

The separability of consumer desires is a necessary and sufficient condition for multi-stage budgeting and Collectivization is consistent of commodity where costs are allocated between edible groups using price indices and intergroup allocations are made independently of other groups. Given the high share of meat types (23 percent of household food and beverage expenditure) in the household budget and the important nutritional role of meat in people's health, in this study, to determine the consumption pattern of meat products in Iran used to Rotterdam demand function. In empirical studies of demand, the concept of separation is used to correctly estimate demand function and limit the number of parameters. For this purpose, data related to price index and cost of meat types (livestock, birds, fish) central Bank over the years 1995-2016 were used. The results of the separability tests support the hypothesis that consumers first divide their income between 13 meat products in three groups (livestock, birds, fish) assigns and then approves the allocation action between the types of meat subgroups that are grouped. Also results of system estimation showed that the groups had a negative intrinsic price elasticity.In the meantime, the price elasticity of groups livestock meat, birds and fish meat are respectively equal to -0.89, -0.59 and -0.77. The basic suggestion of the present study is that prior to any action on the demand system approach there should be weak separability tests.