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The nature of consumer demand and its evolution as per capita income grows is one of the forces or variables that alter the use of land and other agricultural resources under economic development. For affluent consumers, such as those of the United States generally, the price elasticity of food demand is extremely low. Reductions in the real price of food cause only slight increases in per person food intake; conversely, rapid increases in per capita output for the domestic market will allow the added output to be absorbed only under a large reduction in farm prices. Hence, with prices considerably stabilized under domestic agricultural policies, the pattern of food consumption is influenced only slightly by its price at the farm.

Publication Date:



Center for Agricultural and Economic Development, Iowa State University


Ames, IA


Agricultural Economics | Agricultural Science | Agronomy and Crop Sciences | Natural Resource Economics | Soil Science