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The Economic Effects of New Product Beef Promotion in Guatemala

Author

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  • Leister, Amanda M.
  • Capps, Oral, Jr.
  • Rosson, C. Parr, III

Abstract

The implementation of the Central America-Dominican Republic Free Trade Agreement (CAFTA-DR) has expanded trade opportunities for U.S. agricultural producers. U.S. beef is an important product affected by the agreement, and the United States Meat Export Federation (USMEF) invested in a new product promotion program to increase exports of U.S. beef to Guatemala. Consumer responsiveness and the effectiveness of the U.S. branded beef promotion program are analyzed in this study. Demand responses to promotion activities that launched three new U.S. beef value cuts in Guatemala’s Hotel, Restaurant and Institutional (HRI) sector were estimated by applying the Parks Model of Generalized Least Squares regression to pooled, time-series and cross sectional data. Results show a negative relationship between own price and sales quantity, while the effect of advertising on quantity sold is positive. Demand for the U.S. beef value cuts increased as a result of the promotion, although the costs of the promotion program exceeded the additional revenue generated as a result of promotion activities.

Suggested Citation

  • Leister, Amanda M. & Capps, Oral, Jr. & Rosson, C. Parr, III, 2008. "The Economic Effects of New Product Beef Promotion in Guatemala," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6067, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea08:6067
    DOI: 10.22004/ag.econ.6067
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    References listed on IDEAS

    as
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    6. Nicholas E. Piggott, 2000. "The Incidence of the Costs and Benefits of Generic Advertising," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(3), pages 665-671.
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    Livestock Production/Industries; Marketing;

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