DEMAND ELASTICITIES OF FRESH FRUITS AMONG URBAN HOUSEHOLDS IN PESHAWAR, PAKISTAN: EVIDENCE FROM A WORKING–LESER DEMAND SYSTEM

Abstract

This study examined household consumption patterns and demand elasticities for major fresh fruits in Peshawar, Pakistan. Primary data were collected from 120 households residing in the University Campus of Peshawar using a structured questionnaire. Descriptive statistics, multiple regression demand functions, and the Working–Leser demand model were employed to estimate expenditure, own-price, and cross-price elasticities for apple, banana, guava, and orange. Results revealed average monthly household consumption of 5.38 kg of apples, 4.28 dozen bananas, 1.08 kg of guava, and 6.69 dozen oranges. Demand for all fruits was negatively associated with own prices and exhibited statistically significant own-price elasticities ranging from −1.57 to −3.48, indicating elastic demand. Expenditure elasticities ranged from 0.27 to 0.75, suggesting that fruits are normal but necessity goods. Cross-price elasticities revealed both substitution and complementary relationships among fruit categories. The findings imply that price increases may substantially reduce fruit consumption and producer revenues. Policies aimed at reducing production and marketing costs, improving supply chains, and enhancing fruit availability are therefore recommended.