QCOSTARICA (Semanario Universidad) In the campaign, Rodrigo Chaves' biggest promise was not only to lower the cost of living but to do it expeditiously, from day one. However, after the first year of the Chaves administration, the gimmicky speeches executed with decrees still owe to the promise. According to data from the National Institute of…
In the context of fiscal reform in Costa Rica (value added tax revision), the definition of a new basic tax basket, “canasta básica tributaria” (CBT) in Spanish, incorporating nutritional criteria is underway in the country. In this study, price elasticities of major food categories were analyzed using a Quadratic Almost Ideal Demand System (QUAIDS) model. Data from the 2018 National Survey of Household Income and Expenditures was used (INEC, 2018). Measuring price elasticities is essential because it allows: knowing the extent to which food demand reacts to price changes, anticipating changes in the quantities demanded as a result of fiscal policy changes, measuring potential substitution and complementary effects between food groups, and potential nutritional effects of fiscal policies. As a result, it helps providing recommendations on the content of a CBT with nutritional criteria. Results show that the food categories with the most elastic demand are “Bread and cereals”,