Urban Demand for Smallholder Crops; the Case of Fruit s and Vegetables in Nairobi, Kenya
Abstract
Fruits and vegetables are an important source of nutrients for a large number of
Kenyans, as well as major earners of foreign exchange, and are commonly grown crop among
smallholder farmers, who often sell them for cash. Little is known, however, about the
structure of domestic demand for fruits and vegetables in this rapidly urbanizing nation and in
Sub-Saharan Africa in general. We apply the Almost Ideal Demand System (AIDS) with
seemingly unrelated regression (SUR) to data collected through a household expenditure
survey conducted between June and July of 2009.
Inelastic estimates of own-price elasticities for cabbage and tomato, and for all fruits,
with the exception of onion and avocado, indicate that these are necessities. The own-price
elasticities for the vegetables were negative and in the range of (-0.693) and (-0.792). The
own-price elasticities for the fruits range between (-0.577) and (-1.104). Estimated crossprice elasticities also illustrate both substitutability and complementarity in demand.
Expenditure elasticities above unity for kale, onion, mango and avocado suggest they
are luxuries. The high expenditure elasticity of demand for some fruits and vegetables means
that potential growth in demand could be large. We recommend that public investments
address production and marketing systems with the aim of increasing the availability of fruits
and vegetables to Nairobi households, also stimulating domestic demand for these crops
among smallholder farmers.
Citation
Bundi, M. K., Nzuma, J., & Mbatia, O. L. E. (2013). Urban Demand for Smallholder Crops; the Case of Fruits and Vegetables in Nairobi, Kenya.Publisher
University of Nairobi