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U.S. Non-alcoholic Beverage Demand: Evidence from AIDS Model with Dynamic Effect

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  • Kim, GwanSeon
  • Zheng, Yuqing

Abstract

This study estimates the degree of habit formation and demand for the U.S. non-alcoholic beverage market by incorporating a dynamic effect in five different beverages. This study employs a linear-approximate almost ideal demand system (LA-AIDS) to model demand for five non-alcoholic beverages from 1974 through 2014. The results show that current consumption of all non-alcohol beverages is positively related to previous consumption by controlling price and expenditure. This study mainly finds that bottled water is the most habitual product of the non-alcoholic beverage group.

Suggested Citation

  • Kim, GwanSeon & Zheng, Yuqing, 2017. "U.S. Non-alcoholic Beverage Demand: Evidence from AIDS Model with Dynamic Effect," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 35(1), April.
    • Handle: RePEc:ags:jloagb:266965
    DOI: 10.22004/ag.econ.266965
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    References listed on IDEAS

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    2. Okrent, Abigail M. & MacEwan, Joanna P., 2014. "The Effects of Prices, Advertising, Expenditures, and Demographics on Demand for Nonalcoholic Beverages," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 0, pages 1-22.
    3. Okrent, Abigail M. & MacEwan, Joanna P., 2014. "The Effects of Prices, Advertising, Expenditures, and Demographics on Demand for Nonalcoholic Beverages," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 43(1), pages 1-22, April.
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