“Elasticidad precio de la demanda de los principales componentes del consumo de los hogares ecuatorianos: Un análisis del impacto de un aumento del IVA al 15%.”

Abstract

This study aims to estimate the price elasticities of demand for the main consumer goods of Ecuadorian households using the Almost Ideal Demand System (AIDS) and the Quadratic Almost Ideal Demand System (QUAIDS) models, as well as to assess the potential impact of an increase in the Value Added Tax (VAT) to 15% on their consumption patterns. Estimating these elasticities allows for the identification of the degree of sensitivity of consumption to changes in relative prices and the analysis of households’ responses to tax policy changes. The analysis is based on microdata from the National Household Income and Expenditure Survey for Urban and Rural Areas (ENIGHUR by its Spanish acronym), conducted by the National Institute of Statistics and Census (INEC, by its Spanish acronm) for the 2011–2012 period. The results show that the demand for goods among Ecuadorian households exhibits varying degrees of elasticity in response to the increase in VAT to 15%. Some products display inelastic behavior, while others show greater price sensitivity, confirming the existence of limited substitution between food items and differentiated effects of the tax on consumption.