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A Latent-Variable Approach to Modelling Multiple and Resurgent Meat Scares in Italy

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Author Info
Mazzocchi, Mario
Lobb, Alexandra E.

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Abstract

This paper aims to measure the time pattern of multiple and resurgent food scares and their direct and cross-product impacts on consumer response. The Almost Ideal Demand System (AIDS) is augmented by a flexible stochastic framework which has no need for additional explanatory variables such as a media index. Italian aggregate household data on meat demand is used to assess the time-varying impact of a resurgent BSE crisis (1996 and 2000) and the 1999 Dioxin crisis. The impact of the first BSE crisis on preferences seems to be reabsorbed after a few months. The second wave of the scare at the end of 2000 had a much stronger effect on preferences and the positive shift in chicken demand continued to persist after the onset of the crisis. Empirical results show little relevance of the Dioxin crisis in terms of preference shift, whilst not excluding the more relevant price effect.

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Paper provided by European Association of Agricultural Economists in its series 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark with number 24509.

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Date of creation: 2005
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Handle: RePEc:ags:eaae05:24509

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Related research
Keywords: meat demand; BSE; shock; Almost Ideal Demand System; Kalman filter; Food Consumption/Nutrition/Food Safety; D12; I12;

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  1. Alessie, Rob & Kapteyn, Arie, 1991. "Habit Formation, Interdependent References and Demographic Effects in the Almost Ideal Demand System," Economic Journal, Royal Economic Society, vol. 101(406), pages 404-19, May. [Downloadable!] (restricted)
  2. Verbeke, Wim & Ward, Ronald W., 2001. "A fresh meat almost ideal demand system incorporating negative TV press and advertising impact," Agricultural Economics, Blackwell, vol. 25(2-3), pages 359-374, September. [Downloadable!] (restricted)
  3. Nicholas E. Piggott & Thomas L. Marsh, 2004. "Does Food Safety Information Impact U.S. Meat Demand?," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 86(1), pages 154-174, 02. [Downloadable!] (restricted)
  4. Philippe J. Deschamps, 2003. "Time-varying intercepts and equilibrium analysis: an extension of the dynamic almost ideal demand model," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 18(2), pages 209-236. [Downloadable!]
  5. M.-J.J. Mangen & A.M. Burrell, 2001. "Decomposing Preference Shifts for Meat and Fish in the Netherlands," Journal of Agricultural Economics, Blackwell Publishing, vol. 52(2), pages 16-28. [Downloadable!] (restricted)
  6. Deaton, Angus S & Muellbauer, John, 1980. "An Almost Ideal Demand System," American Economic Review, American Economic Association, vol. 70(3), pages 312-26, June. [Downloadable!] (restricted)
  7. Foster, William & Just, Richard E., 1989. "Measuring welfare effects of product contamination with consumer uncertainty," Journal of Environmental Economics and Management, Elsevier, vol. 17(3), pages 266-283, November. [Downloadable!] (restricted)
  8. Burton, Michael & Young, Trevor, 1996. "The Impact of BSE on the Demand for Beef and Other Meats in Great Britain," Applied Economics, Taylor and Francis Journals, vol. 28(6), pages 687-93, June. [Downloadable!] (restricted)
  9. Nayga, Rodolfo M, Jr & Tepper, Beverly J & Rosenzweig, Lee, 1999. "Assessing the Importance of Health and Nutrition Related Factors on Food Demand: A Variable Preference Investigation," Applied Economics, Taylor and Francis Journals, vol. 31(12), pages 1541-49, December. [Downloadable!] (restricted)
  10. Watson, Mark W. & Engle, Robert F., 1983. "Alternative algorithms for the estimation of dynamic factor, mimic and varying coefficient regression models," Journal of Econometrics, Elsevier, vol. 23(3), pages 385-400, December. [Downloadable!] (restricted)
  11. Mario Mazzocchi, 2003. "Time-varying coefficients in the Almost Ideal Demand System: an empirical appraisal," European Review of Agricultural Economics, Oxford University Press for the Foundation for the European Review of Agricultural Economics, vol. 30(2), pages 241-270, June.
  12. Fraser, Iain & Moosa, Imad A, 2002. " Demand Estimation in the Presence of Stochastic Trend and Seasonality: The Case of Meat Demand in the United Kingdom," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 84(1), pages 83-89, February. [Downloadable!] (restricted)
  13. Leybourne, S J, 1993. "Empirical Performance of the AIDS Model: Constant-Coefficient versus Time-Varying-Coefficient Approaches," Applied Economics, Taylor and Francis Journals, vol. 25(4), pages 453-63, April.
  14. Thomas L. Marsh & Ted C. Schroeder & James Mintert, 2004. "Impacts of meat product recalls on consumer demand in the USA," Applied Economics, Taylor and Francis Journals, vol. 36(9), pages 897-909, May. [Downloadable!] (restricted)
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