Determinan dan Elastisitas Permintaan Cabai Rawit, Cabai Merah dan Cabai Hijau di Kota Langsa Dengan Pendekatan Almost Ideal Demand System (AIDS)

Dian Permata Sari Br Surbakti, Dian Asri, Nur Halimatuz Zuhra, Raihan Dary

Abstract


This study aims to analyze the determinants and demand elasticities of red chili, bird’s eye chili, and green chili in household consumption in Langsa City using the Almost Ideal Demand System (AIDS) approach estimated by Seemingly Unrelated Regression (SUR). The results show that red chili has the largest expenditure share, accounting for 79% of total household expenditure on the three chili commodities. The own-price elasticity of red chili is -0.3470, indicating inelastic demand, while its expenditure elasticity is 1.039, indicating that red chili is a normal good with demand responding more than proportionally to changes in household expenditure. The price of red chili has a negative and significant effect on its expenditure share, whereas the price of bird’s eye chili has a positive and significant effect, indicating a substitution tendency in the Marshallian demand response. Cross-price elasticities also reveal asymmetric relationships among chili commodities, while the interpretation of substitution and complementarity should consider income effects. These findings indicate that household demand for red chili is shaped by own-price movements, prices of related chili commodities, and household purchasing power. Policy implications include maintaining price stability and supply continuity, strengthening local production and distribution systems, improving marketing efficiency, and monitoring price interactions among chili commodities to maintain household affordability in Langsa City

Keywords


Chili; Demand; Elasticity; Household; Langsa City

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DOI: http://dx.doi.org/10.33087/mea.v11i2.465

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