Another View of Impact of BSE Crisis in Japanese Meat Market through the Almost Ideal Demand System Model with Markov Switching

During the period in this study, there have been serious food safetyconcerns regarding the Bovine Spongiform Encephalopathy (henceforthBSE) and bird flu in Japan. Previous studies such as Petersonand Chen (2005) and Ishida et al. (2006, 2010) assumed that structuralchange points in demands have already known and they specifiedtransition functions at the change points. On the other hand,we detected the structural change points without any prior informationabout change points. To assess the structural change points inthe Japanese meat market, we employed the Markov switching almostideal demand system (MS-AIDS) model (Allais and Nich`ele, 2007). Inthis study, we found the structural change point coinciding with thetiming of first reported case of BSE, but not of bird flu