Demand and Pricing in the U.S. Margarine Industry
-
Donghun Kim
This paper provides estimates of U.S. demand for margarine and price-cost margins. Demand is estimated using a mixed logit model, which provides a flexible substitution pattern among products. We find that product characteristics, such as nutrient facts, package size and product forms, and household income and age composition are important determinants of demand for margarine. The estimated product-level price elasticities, which are defined as the percent change in market share corresponding to a one percent change in price, range from -1.85 to -6.34, while the cross-price elasticities vary from 0.01 to 0.98. The estimated price-cost margins vary from 28 percent to 58 percent depending on the assumption of industry conduct.
©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston
Articles in the same Issue
- Article
- Demand and Pricing in the U.S. Margarine Industry
- Understanding Consumer Interest in Organics: Production Values vs. Purchasing Behavior
- Estimating the Welfare Loss to Consumers When Food Labels Do Not Adequately Inform: An Application to Fair Trade Certification
- The Role of Farmers' Risk aversion for Contract Choice in the US Hog Industry
- Private Labeling and Competition between Retailers
- Consumer Preferences for Detailed versus Summary Formats of Nutrition Information on Grocery Store Shelf Labels
- Further Results on Asymmetry in Farm-Retail Price Transmission under Spatial Monopoly
- Search Costs in Identity-Preserved Agricultural Markets
- Paying for Shelf Space: An Investigation of Merchandising Allowances in the Grocery Industry
- Agricultural Production Clubs: Viability and Welfare Implications
Articles in the same Issue
- Article
- Demand and Pricing in the U.S. Margarine Industry
- Understanding Consumer Interest in Organics: Production Values vs. Purchasing Behavior
- Estimating the Welfare Loss to Consumers When Food Labels Do Not Adequately Inform: An Application to Fair Trade Certification
- The Role of Farmers' Risk aversion for Contract Choice in the US Hog Industry
- Private Labeling and Competition between Retailers
- Consumer Preferences for Detailed versus Summary Formats of Nutrition Information on Grocery Store Shelf Labels
- Further Results on Asymmetry in Farm-Retail Price Transmission under Spatial Monopoly
- Search Costs in Identity-Preserved Agricultural Markets
- Paying for Shelf Space: An Investigation of Merchandising Allowances in the Grocery Industry
- Agricultural Production Clubs: Viability and Welfare Implications
