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DOI https://doi.org/10.18551/rjoas.2021-03.19
ELASTICITY OF ANIMAL PROTEIN CONSUMPTION IN ACEH PROVINCE OF INDONESIA: THE AIDS (ALMOST IDEAL DEMAND SYSTEM) APPROACH
Zakiah*, Lecturer
Faculty of Agriculture, University of Syiah Kuala, Banda Aceh, Indonesia
Zuhra Fatimah, Lecturer University Islam Kebangsaan Indonesia, Bireun, Indonesia
Maifianti Khori Suci, Lecturer Faculty of Agriculture, University Teuku Umar, Meulaboh, Indonesia
*E-mail author: [email protected]
ABSTRACT
People's food consumption depends on economics, physiology (health), and sociology aspect. All of the aspects include how to fulfill nutrients with a budget constraint, social condition and religion. This research conducted to know how proportion of animal protein expending and how about price elasticity, income elasticity and crossing elasticity of some animal protein commodity. This research use secondary data from National Economic Social Survey. The model used in this research is Almost Ideal Demand System Model (AIDS). The biggest proportion of animal protein expanding is fish commodity, and then beef meat, egg, poultry meat, and milk. Fish is inelastic to income changing, but beef meat, egg, poultry meat and milk is elastic. Besides that, all of the commodity show consumption decreasing if price of the commodity increase. To increase animal protein consumption in Aceh, must keep price stabilization of animal protein commodity and available of animal protein in district and family level.
KEY WORDS
Elasticity, animal protein, consumption, AIDS.
The goal of food policy is to create per capita food sufficiency. In order to meet these needs, operational measures, including production, consumption and distribution, are continuously pursued. This aims to provide a high enough consumption for each member of society, both for main and complementary food consumption.
Foodstuffs are all types of materials that can be used as food ingredients that are safe, have palatability and are healthy for humans. Among several food sources, animal products are one of the most important ingredients. Animal food products that are usually consumed include meat, milk, eggs and fish. This animal food is very rich in protein, where this protein contains essential amino acids which are very suitable for human needs.
According to Martianto (1995) a person's demand for materials is strongly influenced by three aspects, namely physiological (health), economical and sociological. From a health perspective, actual food consumption is needed to meet human nutritional needs. From an economic perspective, price and income are variables that determine one's consumption, while sociological aspects include social and religious issues and beliefs. This aspect is also greatly influenced by a person's customs and place of residence.
The problems of poverty and unemployment are also two big problems that are interconnected and ultimately affect a person's food consumption patterns. Poverty causes a person to have low access to a source of work that can provide a decent income and a source of knowledge / skills, which in turn has an impact on the difficulty of meeting sufficient nutritious food. Currently, it is estimated that 1.67 million children under five years of age (8% of children aged 0-4 years) have the status of malnutrition. Approximately 62 million (15.5
million families) are classified as poor families, so they are unable to meet their food needs, especially animal food, which is generally relatively more expensive than other types of food.
Based on BAPPENAS projections, in 2025 the total population of Indonesia is estimated to reach 273.7 million people. This number is the fourth largest population in the world. Because of this, Indonesia is a very large market, but until now Indonesia is still dependent on imported products, including importing live beef from Australia, egg flour and powdered milk. This is a big challenge in providing animal food as a source of protein for the community.
The total consumption of animal protein for the population of Indonesia is still very low, namely 4.5 grams / capita / day, while the average consumption of animal protein in the world community is 26 grams / capita / day. In 2000, the consumption of poultry meat of the Indonesian population was only 3.5 kg / capita / year, while the consumption of the population of Malaysia (36.7 kg), Thailand (13.5 kg), Philippines (7.6 kg), Vietnam (4, 6 kg) and Myanmar (4.2 kg). Indonesia's population of egg consumption is only 2.7 kg / capita / year, while Malaysia is 14.4 kg, Thailand is 9.9 kg and Philippines is 6.2 kg. If one kilogram of eggs on average consists of 17 eggs, then the egg consumption of the Indonesian population is around 46 eggs / capita / year or 1/8 eggs / capita / day. During the same period, the population of Malaysia ate 245 eggs each year or 2/3 eggs / capita / day. (Poultry International, 2017 in Rusfidra, 2018).
Cases of malnutrition (malnutrition) and edema of hunger in children under five years of age (toddlers) some time ago have become problems that we must resolve. Toddler period is a "golden period" of child development, where brain cells are growing rapidly. In this period, animal protein is needed for the brain to develop optimally. Children under five who are malnourished cause the growth of their brain cells to not develop properly, so that when the brain is scanned, it will look like an "empty brain", while children under five who consume sufficient nutrition in their infancy, the results of their brain scan show the profile of "brain contains". "(Ahmad, 2009).
The National Widyakarya on Food and Nutrition (LIPI, 2015) recommends that the recommended energy and protein requirements are 2150 calories and 46.2 grams / capita / day. From the average protein adequacy per capita per day of 46.2 grams, 15 grams of which are fulfilled from animal food. For Aceh Province, the consumption of animal protein is 14.32 grams / capita / day so that it does not meet the recommended standards (BPS, 2018).
Consumption expenditure in Aceh is still dominated by grains, although the proportion from 2000 to 2007 shows a decrease of 0.71 percent (BPS 2007). This decrease occurs because public consumption leads to food that has a higher nutritional weight and prestige. This is because the level of prosperity continues to increase, especially after the earthquake and tsunami disaster of 26 December 2004, so that people have many choices to meet their nutritional needs. However, with the average percentage of expenditure on the food subgroup of 26.31 percent a month to buy rice, it can be said that the consumption of the Acehnese people is still dominated by rice. This high dependence on rice should also cause a high dependence on complementary products from rice, which in this case is a source of animal protein as a side dish. In terms of complementary rice, the people of Aceh are known to like to consume animal protein, such as fish, eggs and meat compared to vegetable protein such as tofu and tempeh.
Suhadji (2003) said that from the aspect of nutritional quality, the high dependence on vegetable protein is not good because of the incomplete content of the essential amino acids of vegetable protein. Therefore, the role of animal protein in food is very large because it is indispensible or not easily replaced. Based on the above problems, it is deemed necessary to carry out a more in-depth study of the diversity of animal food consumption in Aceh Province, which is reflected in the elasticity of demand due to changes in the price of animal protein and changes in people's income.
This study aims to identify the share allocation of animal food expenditure from various food groups in the form of fish, eggs, livestock meat, poultry and milk consumed by households, and to determine the characteristics of animal food commodities in relation to changes in prices and income.
RJOAS, 3(111), March 2021 LITERATURE REVIEW
Food consumption is closely related to income. The higher a person's income, the more diverse the food is consumed; on the other hand, the proportion of income used to buy rice is getting smaller. In addition, Aliasauddin (2003) revealed that the price that greatly affects the consumption of animal food is price. Therefore, one of the efforts to increase the consumption of animal food can be done through a price policy, particularly the price of animal husbandry production inputs as well as efforts to increase availability at the household level. This effort must also be supported by nutritional counseling, because so far the village community has regarded livestock as savings rather than as a source of highly nutritious food that must be consumed daily (Martianto, 1995).
In a market economy that is a sign for producers about the needs and desires of consumers is the movement of price changes. The price of every good and service that occurs in the market always changes depending on the strength of the attraction between the seller and the buyer, likewise with animal food. At one time, the price of this food has the possibility to increase because the consumer attractiveness becomes greater and vice versa. The sensitivity of changes in consumer demand for animal food due to changes such as prices, income and prices of other goods is called the elasticity of demand.
Demand elasticity measures how sensitive the change in the quantity demanded for goods is to changes in price. When the price of a good falls, the quantity demanded for that good usually rises, in other words the lower the price, the more it is bought. The elasticity of demand is indicated by the ratio of percent change in quantity demanded and percent change in price. When the elasticity of demand for an item shows a value of more than 1, then the demand for that item is said to be elastic in which the amount of goods demanded is strongly influenced by the size of the price. Meanwhile, goods with an elasticity of less than 1 are called inelastic goods, which mean that the price-size effect on the quantity-demanded is not too large. (Case & Fair, 1999)
For normal goods, a decrease in price will result in an increase in the quantity demanded. The demand for an item can be said to be inelastic if the quantity of goods demanded is not affected by price changes. Goods and services that do not have substitutes are usually classified as inelastic. The more that an item has substituted goods, the more elastic the item will be. Conversely, inelastic demand is often associated with "necessities," goods.
Nicholson in Usman (2001) states that the elasticity of demand is divided into 3 types, namely the price elasticity of the goods themselves, cross elasticity and income elasticity. The elasticity of demand for various types of goods varies depending on the number of substitutes available, the percentage of income used to buy an item and the analysis period.
The elasticity of demand can be divided into 5 types, namely: demand is not perfectly elastic (elasticity = 0). The price change does not affect the quantity demanded so the curve is vertical. Demand is inelastic (elasticity <1). The percentage change in quantity demanded is less than the percentage change in price. Unitary demand is elastic (elasticity = 1). The percentage change in quantity demanded is equal to the percentage change in price, elastic demand (elasticity> 1). The percentage change in quantity demanded is greater than the percentage change in price. Demand for perfect elasticity (infinite elasticity), the curve is horizontal. Infinite elastic condition causes the market to be able to buy all the goods in the market at a certain price. However, a slight increase in price will cause demand to be 0 (Case & Fair, 1999).
Animal food, such as fish, livestock, poultry meat, livestock meat and milk, are types of food that are mutually substituted, so it can be said that these foods tend to have elastic demand elasticity. However, apart from being mutually substituting, each of these animal foods has different characteristics, for example the price of fish in Aceh is relatively cheaper than other foods because Aceh is known as a fish-producing area.
The phenomenon of food consumption behavior can be studied using the AIDS demand function model (Almost Ideal Deman System) developed by Deaton and Muellbauer, 1980), as follows:
W, = ai + Scy log pi + bi log (x/p*) +d S For i, j = 1,2,... .5 for each type of food
Where:
Wi = share of ith food expenditure to total food expenditure (percent); pj = aggregate price of the jth food commodity (IDR / kg); X = total household food expenditure (Rp);
P * = Index Stone, which is found by the formula: log p * = Ewk log pk (Rp); S = Number of household members.
From this model, it can be seen later how the price affects the demand for animal food, as well as how the share and elasticity of the demand for each animal food are.
METHODS OF RESEARCH
This research was conducted in Aceh Province using secondary data. The data includes data on the value of expenditure and consumption for food sources of animal protein in Aceh Province which were taken from the 2019 National Socio-Economic Survey (Susenas).
The data analysis methods used were tabulation techniques and econometric models. The tabulation technique is used to view food consumption patterns, while econometric analysis is used to explain the response of food demand to changes in own prices, prices for other commodities and changes in expenditure.
The phenomenon of household food consumption behavior is that there is a relationship between the types of animal food consumed. Therefore the food consumption analysis model used is the Deaton and Muellbauer, 1980) AIDS demand function model, as follows:
W, = ai + Scy log pj + bi log (x/p*) +d S For i, j = 1,2,. .5 denotes fish, poultry, livestock meat, eggs and milk, respectively
Where:
Wi = share of the first animal food expenditure to total animal food laying out (percent); pj = aggregate price of the jth animal food commodity (IDR / kg); X = Total household animal food expenditure (Rp); P * = Index Stone, which is found by the formula: log p * = Ewk log pk (Rp); S = Number of household members.
From equation (1) it can be derived the price elasticity itself, the cross price elasticity and the expenditure elasticity, as follows:
Own price elasticity: eii = cii / wi - 1 (1)
Cross price elasticity: eij = cij / wj (2)
Expenditure elasticity: ni = biwi + 1 (3)
The elasticity value of total expenditure was estimated using the linear logarithmic model as follows:
Ln Yf = a + nf ln YT (4)
Where:
Yf = Total expenditure on animal food; YT = total household expenses.
Furthermore, the total household expenditure elasticity (as an approach to income elasticity) can be calculated based on the following formula:
niT = nf - ni
Where:
niT = the i-th animal food income elasticity;
Hi = elasticity of animal food expenditure;
nf = elasticity of estimate with AIDS.
RESULTS AND DISCUSSION
The pattern of animal food consumption is seen from the proportion of expenditure of each animal food commodity to total food expenditure which is also influenced by the price and level of consumption of each commodity. Based on the results of the analysis, the following results were obtained:
Table 1 - Level of Animal Food Consumption Proportion of Animal Food Expenditure
to Total Animal Food Expenditure
Commodity Proportion (percent) Level of Consumption (Kg/household / week)
Fish 58.42 3.88
Poultry Meat 10.15 0.59
Animal Meat 12.41 0.32
Eggs 12.40 0.80
Milk 6.62 0.14
Total 100 5.73
From Table 1, it can be seen that fish has the largest proportion of expenditure compared to other animal food (58.42 percent) of the total expenditure on animal food. This is also supported by the high level of fish consumption compared to other animal foods, namely 3.88 kg / week. This is presumably due to the abundance of fish in this area, so the price of fish is felt to be relatively cheap. The most popular types of fish are tuna (23.30 percent), mackerel (16.49 percent), shrimp (13.85 percent) and milkfish (9.8 percent).
The second largest proportion is livestock meat, namely 12.41 percent, while the level of livestock meat consumption is very low, namely 0.32 kg / week. The occurrence of this opposite is allegedly due to the relatively expensive price of livestock meat compared to other meats. Beef is the most popular type of beef (90.15 percent) with a consumption rate of 0.26 kg / week.
The next proportion is eggs, which is 12.40 percent, while the consumption level is 0.80 kg / week. The most popular types of eggs were eggs of broilers and free-range chicken eggs, which were 49.43 percent and 35.05 percent, respectively.
Poultry meat has a proportion value of 10.15 percent of the total expenditure on animal food, with a consumption level of 0.59 kg. The most popular types of poultry were native chicken (57.56 percent) and purebred chicken (34.78 percent). Meanwhile, milk with a proportion value of 6.62 percent is animal food with the smallest proportion compared to other animal foods. This is because the level of consumption is relatively low compared to other animal foods (0.14 kg). This shows that the level of milk consumption of the Acehnese people is still relatively low
The results of the analysis show that the coefficient of determination is 0.7178. This shows that the variation in the proportion of expenditure of each animal food commodity which can be explained by the price and expenditure variables in the model is 71.78 percent. This indicates that there are factors other than prices and expenditures that affect the diversity of expenditure proportions, such as tastes and habits. Each of the explanatory factors for price and expenditure has a significant effect on the model at the 0.99 level of confidence.
From the results of the analysis of the value of the price elasticity itself for all commodities, it shows a negative value. This is as expected because of the nature of the demand curve which is always negative to the price, where if there is an increase in the price of a commodity, the demand for that commodity will decrease.
Table 2 - Value of Own Price Elasticity and Income Elasticity of Animal Food Commodities in Aceh
Commodity Own Price Elasticity Price Elasticity
Fish -1.30 0.58
Poultry Meat -1.75 1.74
Animal Meat -1.28 1.90
Eggs -0.24 0.67
Milk -0.27 1.78
The value of the price elasticity itself shows that there are two patterns in the consumption of animal foods in Aceh. Fish, poultry and livestock meat commodities have an elasticity value greater than one (very elastic). For fish, it is suspected that this is because the people of Aceh really like fish, so that changes in the price of fish will have a significant impact on their demand, namely if the price of fish increases by 1 percent, the demand for fish will decrease by 1.30 percent.
Poultry and livestock meat commodities are elastic, although the level of consumption is still low. If it is related to the price, the price of livestock meat is relatively high and it is not affordable for the people, especially those with low income. However, the people of Aceh have the custom of consuming meat (livestock and poultry) in commemorating Islamic holidays such as Eid al-Fitr, Eid al-Adha, the Prophet's birthday and welcoming the month of Ramadan. It is suspected that the data collection from BPS was carried out at these times, so that changes in meat prices would have a significant impact on meat demand. In this case for poultry meat, if the price increases by 1 percent, the demand will decrease by 1.75 percent, whereas if the price of livestock meat increases by 1 percent, the demand for livestock meat will decrease by 1.28 percent.
Egg and milk commodities have an elasticity value below one (inelastic). From the point of view of commodity prices, eggs are actually relatively affordable to the wider community. Hence changes in egg prices have little impact on egg demand and people tend to maintain a low level of consumption. Sufficient availability of fish at relatively affordable prices is thought to be the cause of the low consumption of these livestock products.
The income elasticity value shows that all animal food groups are normal goods. This indicates that the consumption of these commodities will continue to increase with an increase in income to a certain extent. For commodities of poultry meat, livestock meat, and milk are very elastic (elasticity is greater than one). This shows that these three commodities are superior goods. In other words, it can be said that the percentage change in consumption will be greater than the percentage change in income. Meanwhile, fish and egg commodities are relatively inelastic (elasticity is less than one). This indicates that the percentage change in demand will be lower than the percentage change in income. However, in general, this elasticity reflects the characteristics of basic commodities.
Based on the results of the calculation of cross price elasticity, it is known that there are 10 which show a positive relationship and 10 which shows a negative relationship, which shows that there are 10 complementary relationships and 10 substitution relationships that occur between animal foods.
Table 3 - The Cross Price Elasticity of Animal Food Commodities in Aceh
Commodity Fish Poultry Meat Animal Meat Eggs Milk
Fish - 0.27 0.16 -0.10 0.04
Poultry Meat 1.40 - -0.35 0.07 -0.39
Animal Meat 0.65 -0.26 - 0.08 -0.16
Eggs -0.44 0.07 0.08 - -0.46
Milk 3.89 -1.73 -1.96 -0.98 -
The value of the elasticity shows how strong the relationship between these commodities is. In general, it can be seen that the substitution and complementary relationships that occur are not too close, because most of the elasticities obtained are less than one. For the strongest substitution relationship occurred in the relationship between fish
and milk, namely 3.89. This means that if the price of milk increases by 10 percent, the demand for fish will increase by 3.89 percent.
CONCLUSION
Fish is the main source of animal protein in Aceh, because it has the largest proportion of expenditure compared to other animal foods, followed by livestock meat, eggs, poultry and milk.
The behavior of household animal food consumption is in accordance with the law of demand, with all signs of price elasticity being negative. This means that if the price of these commodities increases, the demand for these commodities will decrease. Commodities of fish, livestock meat and poultry meat are elastic, while eggs and milk are inelastic.
The five commodities analyzed are considered normal commodities because their income elasticity value is positive. Of the large elasticity values, fish and eggs are the main commodities, while poultry meat, livestock meat and milk are considered superior commodities.
IMPLICATIONS
It is necessary to make efforts to increase the consumption of food sources of animal protein, namely by increasing the availability of animal food at the regional and household levels. Increasing the availability of animal food can be done by helping breeders to improve the quality and quantity of their livestock, either through counseling, assistance with quality livestock seeds and assistance in eradicating livestock diseases.
Efforts should be made to continue to maintain the stability of animal food prices, especially for poultry meat, livestock meat and milk commodities. Efforts to maintain price stability for animal food include the stability of production input prices, such as feed prices. The consumption of milk in the community can also be increased by making the price of milk affordable by the community.
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