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Micro-Demand Systems Analysis of Non-Alcoholic Beverages in the United States: An Application of Econometric Techniques Dealing With Censoring

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  • Alviola, Pedro A., IV
  • Capps, Oral, Jr.
  • Wu, Ximing

Abstract

A censored Almost Ideal Demand System (AIDS) and a Quadratic Almost Ideal Demand System (QUAIDS) were estimated in modeling non-alcoholic beverages. Five estimation techniques were used, including the conventional Iterated Seemingly Unrelated Regression (ITSUR), two-stage methods such as the Heien and Wessells (1990) and the Shonkwiler and Yen (1999) approaches, the generalized maximum entropy method and the Amemiya-Tobin framework of Dong, Gould and Kaiser (2004). Our results based on various specifications and estimation techniques are quantitatively similar and indicate that price elasticity estimates have a greater variability in more highly censored non-alcoholic beverage items such as tea, coffee and bottled water as opposed to less censored non-alcoholic beverage items such as carbonated softdrinks, milk and fruit juices.

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Bibliographic Info

Paper provided by Agricultural and Applied Economics Association in its series 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado with number 60462.

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Date of creation: 2009
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Handle: RePEc:ags:aaea10:60462

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Related research

Keywords: Censored demand systems; AIDS; QUAIDS; Two-Step Methods; Generalized Maximum Entropy; Amemiya-Tobin Framework; Non-Alcoholic Beverages; Agribusiness; Consumer/Household Economics; Demand and Price Analysis; Food Consumption/Nutrition/Food Safety; C34; D12;

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Cited by:
  1. Berardi, N. & Sevestre, P. & Tepaut, M. & Vigneron, A., 2012. "The impact of a `soda tax' on prices. Evidence from French micro data," Working papers 415, Banque de France.
  2. Alamo, Carmen I. & Malaga, Jaime E., 2012. "Coffee Differentiation: Demand Analysis at Retail Level in the US Market," 2012 Annual Meeting, February 4-7, 2012, Birmingham, Alabama 119885, Southern Agricultural Economics Association.

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