Demand for food among different income groups of the Slovak population

Slovakia belongs to the countries where households spend a significant part of their income on necessary goods such as food.Inflationary shocks and policy interventions can have significantly different effects on different income groups of the population.Therefore, it is important to understand changes in food demand in different population groups.We employ a linearly approximated almost ideal demand system (AIDS) to estimate a demand system for food commodities in four income quartiles of households.We use the data from the Slovak household budget survey for 2020.The results reveal that if households change their total food expenditures, the most significant changes in food demand are expected in the market for meat.Wealthier households are less sensitive to price changes.In general, demand for food commodities is price inelastic.Regardless of the income quartile of households, the least flexible reaction to a price change is anticipated for bread and cereals.Demand elasticities help to foresee impacts of policies supporting consumption of households.