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Abstract
The linear approximate version of the almost ideal demand system (LA-AIDS) model is estimated using data from the
Lithuanian household budget survey (HBS) covering the period from July 1992 to December 1994. Price and real expenditure
elasticities for 12 food groups were estimated based on the estimated coefficients of the model. Very little or nothing is
known about the demand parameters of Lithuania and other former socialist countries, so the results are of intrinsic interest.
Estimated expenditure elasticities were positive and statistically significant for all food groups, while all own-price elasticities
were negative and statistically significant, except for that of eggs which was insignificant. Results suggest that Lithuanian
household consumption did respond to price and real income changes during their transition to a market-oriented economy.
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