Modeling rice grain-type preferences in Bangladesh

What is it about?

It is a stylized fact that with an increase in income, households increasingly consume higher food-value enriched items like meat and fish by substituting cereals. Cereals, such as rice are available in a range of qualities from ordinary types (coarse grains) to premium types (fine grains). Therefore, as household incomes increase, households may consume more premium-type rice grains, while overall consuming less rice/carbohydrates. Understanding households’ grain-type choice in relation to increase in income is important (fine-grain vs. coarse-grain type), as grain-type of any cereal including rice is the second most important factor to farmers after yield. This is because, rice prices and therefore the well-being of the farmers is highly dependent on grain-type. Empirical literature seldom focuses on whether or not households substitute fine-grain rice for coarse-grain rice over time. Using household rice-consumption data from Bangladesh and applying multivariate probit and Seemingly Unrelated Regression (SUR) estimation procedures, this study demonstrates that urban, as well as wealthy households and more importantly, households headed by educated heads and spouses are more likely to consume fine-grain rice than others with less education and income. Based on the findings, this study concludes that the breeding programs of major cereals, such as rice and wheat, both at the national and international levels, should take consumer grain-type preferences into consideration when developing new varieties.

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