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U.S. Demand for Organic and Conventional Fresh Fruits: The Roles of Income and Price

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Author Info

  • Biing-Hwan Lin

    ()
    (Economic Research Service, US Department of Agriculture, 1800 M Street NW, Washington, DC, 20036-5831, USA)

  • Steven T. Yen

    ()
    (Department of Agricultural Economics, The University of Tennessee, 2621 Morgan Circle, Knoxville, TN, 37996-4518, USA)

  • Chung L. Huang

    ()
    (Department of Agricultural and Applied Economics, 313-E Conner Hall, University of Georgia, Athens, GA, 30602-7509, USA)

  • Travis A. Smith

    ()
    (Economic Research Service, US Department of Agriculture, 1800 M Street NW, Washington, DC, 20036-5831, USA)

Abstract

Using retail purchase data reported by Nielsen’s Homescan panel this study investigates the U.S. demand for organic and conventional fresh fruits. The study fills an important research void by estimating the much needed income and price elasticities for organic and conventional fruits utilizing a censored demand approach. Household income is found to affect organic fruit consumption. Consumers are more responsive to price of organic fruits than to price of conventional fruits. Cross-price effects suggest that a change in relative prices will more likely induce consumers to “cross-over” from buying conventional fruits to buying organic fruits, while it is less likely that organic consumers will “revert” to buying conventional fruits.

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File URL: http://www.mdpi.com/2071-1050/1/3/464/pdf
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File URL: http://www.mdpi.com/2071-1050/1/3/464/
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Bibliographic Info

Article provided by MDPI, Open Access Journal in its journal Sustainability.

Volume (Year): 1 (2009)
Issue (Month): 3 (August)
Pages: 464-478

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Handle: RePEc:gam:jsusta:v:1:y:2009:i:3:p:464-478:d:5548

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Web page: http://www.mdpi.com/

Related research

Keywords: National Organic Standards; Nielsen Homescan; organic fruit demand; price elasticities; censored demand system;

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Cited by:
  1. Vasiliki Fourmouzi & Margarita Genius & Peter Midmore, 2012. "The Demand for Organic and Conventional Produce in London, UK: A System Approach," Journal of Agricultural Economics, Wiley Blackwell, vol. 63(3), pages 677-693, 09.

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