An Application of Gamma Distribution to the Income Distribution and the Estimation of Potential Food Demand Functions ()
Shunsuke Mori1,
Daichi Nakata2,
Tomohiro Kaneda2
1Department of Industrial Administration, Faculty of Science and Technology, Tokyo University of Science, Noda, Japan.
2Hitachi, Ltd., Tokyo, Japan.
DOI: 10.4236/me.2015.69095
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Abstract
Poverty and hunger are
the central issues against the sustainable development. Today, more than 800
million people are suffering from insufficient nutrition according to FAO (FAO,
2010). However, on the other hand, it is often pointed out that the per capita
food production already meets the demand for the per capita food requirement.
The above contradictory observation suggests that many people cannot access the
food market because of the low income. The availability of electricity and
other energy is also the case. Since these issues are mainly caused by the
inequity of income distribution, its quantitative analysis is indispensable to
evaluate the societal policy towards the sustainable future. However, since the
existing indicators such as Gini coefficients do not represent the income
distribution explicitly, they fail to assess the effects of social policy for
the improvement of purchasing power of poor people. Population of absolute
poverty who gets less than 1.25 US dollar per day is also provided by World
Bank. This indicator does not show the distribution pattern of middle to high
income classes. The authors would thus point out the need for an alternative
method. This paper describes an application of Gamma distribution to the income
distribution patterns. The parameters are statistically estimated based on the
income quintile data provided by World Bank. The results show how the income
distribution has changed historically by country. Based on the future income
distribution and the simulation results of the author’s crop market model, we
evaluate the share of people who cannot afford the major crop. The authors also
propose a procedure to estimate the potential food demand function considering
the income distribution changes, suggesting that the future demand could be
affected by not only the per-capita income growth but the income distribution
changes.
Share and Cite:
Mori, S. , Nakata, D. and Kaneda, T. (2015) An Application of Gamma Distribution to the Income Distribution and the Estimation of Potential Food Demand Functions.
Modern Economy,
6, 1001-1017. doi:
10.4236/me.2015.69095.
Conflicts of Interest
The authors declare no conflicts of interest.
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