DETERMINANT OF RICE CONSUMPTION: EVIDENCE FROM PANEL DATA IN INDONESIA

Rice is the main staple food for the population of Indonesia. Although people in several provinces such as Papua and Maluku initially consumed staple foods other than rice such as sago and tubers, they are currently switching to consuming rice. Rice demand for consumption in Indonesia is increasing with the increasing population. This study aims to determine the dynamics of rice consumption and its determinants in Indonesia. The data used are data originating from the Central Bureau of Statistics and the Ministry of Agriculture, which includes data from 33 provinces in the period 2010- 2018. The data was analyzed using panel data regression analysis with the selected model fixed effect model on the equality of functions of rice consumption in Indonesia. The results of the analysis show that rice consumption in Indonesia influenced by the number of households, rice prices, cooking oil prices, chicken prices, participation in rice consumption, age and social assistance. Price elasticity and income elasticity is inelastic, but income elasticity not statistically significant. There are indications that food diversification is happening, can be seen from consumption decline due to social assistance which provides alternative choices of consumption.