IDEAS home Printed from https://ideas.repec.org/p/ags/iaae15/212197.html
   My bibliography  Save this paper

Analyzing Consumer Demand During A Food Scandal: The Case of Dioxin Contaminated Feed in Germany And The Media

Author

Listed:
  • Rieger, Jorg
  • Kuhlgatz, Christian

Abstract

This study investigates the effect of media coverage on the consumer demand for pork chops and chicken filet in the course of the German dioxin scandal in 2011. A media index is constructed to account for the dynamics of the media coverage for the first nineteen calendar weeks in 2011. The response of the German households is estimated with a dynamic correlated random effect Tobit model based on weekly panel data provided by the GfK and data on media coverage provided by Lexis Nexis. Our dataset contains detailed information on purchasing transactions and socio-economic characteristics of the consumer households. The empirical results show that unobserved heterogeneity is important to consider when analyzing the determinants of demand in times of a scandal. For both meat products, media had a significant negative effect on the propensity to consume as well as the quantity purchased.

Suggested Citation

  • Rieger, Jorg & Kuhlgatz, Christian, 2015. "Analyzing Consumer Demand During A Food Scandal: The Case of Dioxin Contaminated Feed in Germany And The Media," 2015 Conference, August 9-14, 2015, Milan, Italy 212197, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae15:212197
    DOI: 10.22004/ag.econ.212197
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/212197/files/Rieger-Analysis%20of%20Consumer%20Demand%20during%20a%20Food%20Scandal-1247.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.212197?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. J. Scott Shonkwiler & Steven T. Yen, 1999. "Two-Step Estimation of a Censored System of Equations," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(4), pages 972-982.
    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.
    3. Nicholas E. Piggott & Thomas L. Marsh, 2004. "Does Food Safety Information Impact U.S. Meat Demand?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 86(1), pages 154-174.
    4. Jeffrey M. Wooldridge, 2005. "Simple solutions to the initial conditions problem in dynamic, nonlinear panel data models with unobserved heterogeneity," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 20(1), pages 39-54, January.
    5. Nicholas E. Piggott & Victor E. Wright, 1992. "From Consumer Choice Process To Aggregate Analysis: Marketing Insights For Models Of Meat Demand," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 36(3), pages 233-248, December.
    6. Deaton, Angus, 1988. "Quality, Quantity, and Spatial Variation of Price," American Economic Review, American Economic Association, vol. 78(3), pages 418-430, June.
    7. Mark E. Smith & Eileen O. van Ravenswaay & Stanley R. Thompson, 1988. "Sales Loss Determination in Food Contamination Incidents: An Application to Milk Bans in Hawaii," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 70(3), pages 513-520.
    8. Mario Mazzocchi, 2006. "No News Is Good News: Stochastic Parameters versus Media Coverage Indices in Demand Models after Food Scares," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(3), pages 727-741.
    9. Mundlak, Yair, 1978. "On the Pooling of Time Series and Cross Section Data," Econometrica, Econometric Society, vol. 46(1), pages 69-85, January.
    10. Blanciforti, Laura Ann & Green, Richard D. & King, Gordon A., 1986. "U.S. Consumer Behavior over the Postwar Period: An Almost Ideal Demand System Analysis," Monographs, University of California, Davis, Giannini Foundation, number 11939, December.
    11. Islam Hassouneh & Teresa Serra & José M. Gil, 2010. "Price transmission in the Spanish bovine sector: the BSE effect," Agricultural Economics, International Association of Agricultural Economists, vol. 41(1), pages 33-42, January.
    12. Roger A. Dahlgran & Dean G. Fairchild, 2002. "The demand impacts of chicken contamination publicity-a case study," Agribusiness, John Wiley & Sons, Ltd., vol. 18(4), pages 459-474.
    13. X. M. Gao & Timothy Richards & Albert Kagan, 1997. "A latent variable model of consumer taste determination and taste change for complex carbohydrates," Applied Economics, Taylor & Francis Journals, vol. 29(12), pages 1643-1654.
    14. Sinne Smed, 2012. "Information and consumer perception of the “organic” attribute in fresh fruits and vegetables," Agricultural Economics, International Association of Agricultural Economists, vol. 43, pages 33-48, November.
    15. McDonald, John F & Moffitt, Robert A, 1980. "The Uses of Tobit Analysis," The Review of Economics and Statistics, MIT Press, vol. 62(2), pages 318-321, May.
    16. Tansel, A., 1992. "Cigarette Demand, Health Scares and Education in Turkey," Papers 660, Yale - Economic Growth Center.
    17. Richards, Timothy J. & Patterson, Paul M., 1999. "The Economic Value Of Public Relations Expenditures: Food Safety And The Strawberry Case," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 24(2), pages 1-23, December.
    18. John L. Park & Oral Capps, 1997. "Demand for Prepared Meals by U.S. Households," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(3), pages 814-824.
    19. Zheng, Zhihao & Henneberry, Shida Rastegari, 2010. "The Impact of Changes in Income Distribution on Current and Future Food Demand in Urban China," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 35(1), pages 1-21.
    20. Rickertsen, Kyrre & Chalfant, James A & Steen, Marie, 1995. "The Effects of Advertising on the Demand for Vegetables," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 22(4), pages 481-494.
    21. Deborah J. Brown & Lee F. Schrader, 1990. "Cholesterol Information and Shell Egg Consumption," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 72(3), pages 548-555.
    22. Böcker, A. & Mahlau, G., 1999. "BSE-Medienberichterstattung auf regionaler Ebene: Bestandteile, Entwicklung und Auswirkungen auf das Konsumentenverhalten," Proceedings “Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V.”, German Association of Agricultural Economists (GEWISOLA), vol. 35.
    23. 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.
    24. Thomas L. Cox & Michael K. Wohlgenant, 1986. "Prices and Quality Effects in Cross-Sectional Demand Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 68(4), pages 908-919.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Rieger, Jörg & Weible, Daniela, 2016. "Analyse Der Nachfragereaktionen Auf Den Dioxinskandal: Sind Die Medien Oder Letztendlich Konsumgewohnheiten Entscheidend?," 56th Annual Conference, Bonn, Germany, September 28-30, 2016 244777, German Association of Agricultural Economists (GEWISOLA).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rieger, Jörg & Kuhlgatz, Christian & Anders, Sven, 2016. "Food scandals, media attention and habit persistence among desensitised meat consumers," Food Policy, Elsevier, vol. 64(C), pages 82-92.
    2. Martin Browning & Lars Gårn Hansen & Sinne Smed, 2013. "Rational inattention or rational overreaction? Consumer reactions to health news," IFRO Working Paper 2013/14, University of Copenhagen, Department of Food and Resource Economics.
    3. Rieger, Jörg & Weible, Daniela, 2016. "Analyse Der Nachfragereaktionen Auf Den Dioxinskandal: Sind Die Medien Oder Letztendlich Konsumgewohnheiten Entscheidend?," 56th Annual Conference, Bonn, Germany, September 28-30, 2016 244777, German Association of Agricultural Economists (GEWISOLA).
    4. Taylor, Mykel & Klaiber, H. Allen & Kuchler, Fred, 2016. "Changes in U.S. consumer response to food safety recalls in the shadow of a BSE scare," Food Policy, Elsevier, vol. 62(C), pages 56-64.
    5. Radwan, Amr & Gil, Jose Maria & Ben Kaabia, Monia & Serra, Teresa, 2009. "Food Safety Information And Meat Demand In Spain," 2009 Conference, August 16-22, 2009, Beijing, China 51540, International Association of Agricultural Economists.
    6. Radwan, Amr & Gil, Jose Maria & Ben Kaabia, Monia & Serra, Teresa, 2008. "Modeling The Impact Of Food Safety Information On Meat Demand In Spain," 107th Seminar, January 30-February 1, 2008, Sevilla, Spain 6672, European Association of Agricultural Economists.
    7. Hassouneh, Islam & Radwan, Amr & Serra, Teresa & Gil, José M., 2012. "Food scare crises and developing countries: The impact of avian influenza on vertical price transmission in the Egyptian poultry sector," Food Policy, Elsevier, vol. 37(3), pages 264-274.
    8. Islam Hassouneh & Teresa Serra & José M. Gil, 2010. "Price transmission in the Spanish bovine sector: the BSE effect," Agricultural Economics, International Association of Agricultural Economists, vol. 41(1), pages 33-42, January.
    9. Irz, Xavier & Mazzocchi, Mario & Réquillart, Vincent & Soler, Louis-Georges, 2015. "Research in Food Economics: past trends and new challenges," Revue d'Etudes en Agriculture et Environnement, Editions NecPlus, vol. 96(01), pages 187-237, March.
    10. Yadavalli, Anita & Jones, Keithly, 2014. "Does media influence consumer demand? The case of lean finely textured beef in the United States," Food Policy, Elsevier, vol. 49(P1), pages 219-227.
    11. Zhou, Li & Turvey, Calum & Hu, Wuyang & Ying, Ruiyao, 2015. "Fear and Trust: How Risk Perceptions of Avian Influenza Affect the Demand for Chicken," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 202077, Agricultural and Applied Economics Association.
    12. Beach, Robert H. & Zhen, Chen, 2008. "Consumer Purchasing Behavior in Response to Media Coverage of Avian Influenza," 2008 Annual Meeting, February 2-6, 2008, Dallas, Texas 6750, Southern Agricultural Economics Association.
    13. Mario Mazzocchi & Davide Delle Monache & Alexandra Lobb, 2006. "A structural time series approach to modelling multiple and resurgent meat scares in Italy," Applied Economics, Taylor & Francis Journals, vol. 38(14), pages 1677-1688.
    14. Laura Andersen & Sinne Smed, 2013. "What is it consumers really want, and how can their preferences be influenced? The case of fat in milk," Empirical Economics, Springer, vol. 45(1), pages 323-347, August.
    15. Mazzocchi, Mario, 2004. "Food Scares and Demand Recovery Patterns: An Econometric Investigation," 84th Seminar, February 8-11, 2004, Zeist, The Netherlands 24990, European Association of Agricultural Economists.
    16. Chantal Toledo & Sofia Berto Villas-Boas, 2019. "Safe or Not? Consumer Responses to Recalls with Traceability," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 41(3), pages 519-541, September.
    17. Tselepidakis, Elina, 2015. "Food Safety and the Demand for Leafy Greens," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205583, Agricultural and Applied Economics Association.
    18. 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.
    19. Tselepidakis, Elina, 2012. "Food Safety And The Demand For Meat Products," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124968, Agricultural and Applied Economics Association.
    20. Mykel R. Taylor, 2009. "Does Food Safety Information Affect Consumers' Decision to Purchase Mean and Poultry? Evidence from U.S. Household Level Data," Working Papers 2009-11, School of Economic Sciences, Washington State University.

    More about this item

    Keywords

    Agricultural and Food Policy; Consumer/Household Economics; Food Consumption/Nutrition/Food Safety; Food Security and Poverty;
    All these keywords.

    JEL classification:

    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • Y90 - Miscellaneous Categories - - Other - - - Other

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:iaae15:212197. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/iaaeeea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.