Home Bias in U.S. Beer Consumption

Rigoberto Lopez and Xenia Matschke

No 4, Working Papers from University of Connecticut, Department of Agricultural and Resource Economics, Charles J. Zwick Center for Food and Resource Policy

Abstract: We apply the Berry, Levinsohn, and Pakes (1995) market equilibrium model to data from 30 brands of beers sold in 12 U.S. cities over 20 quarters (1988-92) to estimate the consumers’ taste for beer characteristics (price, alcohol content, and calories) as well as for the cultural region of origin (USA, Anglo-European, Germanic, and countries bordering the U.S.). Consumer heterogeneity is allowed with respect to age and income. Overall we end up with 7,200 beer brand observations (30x12x20) and 13,920 (58 random draws x 12 x 20) consumer observations. Empirical results indicate that indeed there is home bias with respect to foreign beers. Home bias is less accentuated among older and more affluent individuals.

Keywords: Home bias; beer; country of origin; demand; differentiated products (search for similar items in EconPapers)
JEL-codes: D12 F14 L66 (search for similar items in EconPapers)
Pages: 15 pages
Date: 2011-08
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Home Bias in US Beer Consumption (2012)
Working Paper: Home Bias in U.S. Beer Consumption (2011)
Working Paper: Home Bias in U.S. Beer Consumption (2007)
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