Estimating the Demand Function and Proposing Approaches for Optimal Distribution of Iran’s Three Major Grains

Given the importance of grain consumption in household baskets and the necessity of appropriate price and income policies for such commodities, this research employs the AIDS (Almost Ideal Demand System) demand function to estimate and examine various price elasticities of wheat, barley, and domestic rice in Iran over the period ۱۹۹۷-۲۰۲۳. The results indicate that, based on price elasticities, rice and barley are considered necessities, but the price of wheat did not significantly impact demand share, despite it being a staple food. Furthermore, barley and rice are complementary goods, while barley and wheat are substitutes. The study concludes with recommendations for the production of these grains, taking into account domestic needs and shifting consumer patterns, through policy-making, research and development centers, and similar initiatives.

Keywords:

Demand , Price Elasticity , Policymaking