Households' Choices Among Fluid Milk Products: What Happens When Income and Prices Change?

Diansheng Dong () and Hayden Stewart

No 262226, Economic Research Report from United States Department of Agriculture, Economic Research Service

Abstract: Households have several ways to economize on their purchases at retail food stores when prices increase or their incomes fall. This report investigates a household’s choice among retail fluid milk products categorized along three dimensions: three levels of fat content, two levels of package size, and organic versus conventional methods of production. Nielsen Homescan data from 2007-08 are used to estimate a choice model, which accounts for price, income, and other choice determinants. Results show that small changes in prices and income have a modest impact on a household’s choice among milk products. However, households mitigate the impact of more substantial price and income shocks by switching from more expensive to less expensive products. We also find that the demand for organic milk is more sensitive to swings in income and food prices than is demand for conventional milk.

Keywords: Consumer/Household Economics; Food Consumption/Nutrition/Food Safety; Livestock Production/Industries (search for similar items in EconPapers)
Pages: 36
Date: 2013-04-01
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:uersrr:262226

DOI: 10.22004/ag.econ.262226

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