The food system transformation in developing countries: A disaggregate demand analysis for fruits and vegetables in Vietnam

Abstract

Food systems in developing countries are currently undergoing a rapid transformation towards high-value products and modern supply chains. While supply side aspects of this transformation have beenanalyzed previously, issues of consumer demand have received much less attention. This article analysesdemand patterns for fresh fruits and vegetables in Vietnam, using household survey data and a demandsystems approach. Demand for products from modern supply chains – particularly supermarkets andnon-traditional imports – is highly income elastic, and the income effect is stronger than the impact ofprices and supermarket penetration. This highlights the importance of considering demand side aspectswhen projecting future trends. Our results imply a continued restructuring of the food sector in the fur-ther process of economic development.