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An analysis of at-home demand for ice cream in the United States

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Author Info

  • Davis, Chris
  • Blayney, Don
  • Yen, Steven
  • Cooper, Joseph C.

Abstract

Ice cream has been manufactured commercially in the United States since the middle of the 19th century. Ice cream and frozen dessert products comprise an important and relatively stable component of the United States dairy industry. As with many other dairy products, ice cream is differentiated in several dimensions. A censored translog demand system model was employed to analyze purchases of 3 ice cream product categories. The objective of this study was to determine the effect that changes in retail prices and consumer income have on at-home ice cream consumption. The analysis was based on Nielsen 2005 home scan retail data and used marital status, age, race, education, female employment status, and location in the estimations of aggregate demand elasticities. Results revealed that price and consumer income were the main determinants of demand for ice cream products. Calculated own-price elasticities indicated relatively elastic responses by consumers for all categories except for compensated bulk ice cream. All expenditure elasticities were inelastic except for bulk ice cream, and most of the ice cream categories were substitutes. Ongoing efforts to examine consumer demand for these products will assist milk producers, dairy processors and manufacturers, and dairy marketers as they face changing consumer responses to food and diet issues.

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File URL: http://mpra.ub.uni-muenchen.de/24782/
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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 24782.

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Date of creation: Dec 2009
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Publication status: Published in Journal of Dairy Science 12.92(2009): pp. 6210-6216
Handle: RePEc:pra:mprapa:24782

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Keywords: Nielsen home scan retail data; dairy demand; elasticity; ice cream;

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  1. repec:jaa:jagape:v:35:y:2003:i:3:p:599-609 is not listed on IDEAS
  2. Hayley H. Chouinard & David E. Davis & Jeffrey LaFrance & Jeffrey M. Perloff, 2008. "Milk Marketing Order Winners and Losers," Working Papers 2009-03, School of Economic Sciences, Washington State University.
  3. Maynard, Leigh J. & Veeramani, Venkat N., 2003. "Price Sensitivities for U.S. Frozen Dairy Products," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 35(03), December.
  4. Diansheng Dong & Harry M. Kaiser, 2005. "Coupon Redemption and Its Effect on Household Cheese Purchases," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 87(3), pages 689-702.
  5. Steven T. Yen & Biing-Hwan Lin, 2006. "A Sample Selection Approach to Censored Demand Systems," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(3), pages 742-749.
  6. Christensen, Laurits R & Jorgenson, Dale W & Lau, Lawrence J, 1975. "Transcendental Logarithmic Utility Functions," American Economic Review, American Economic Association, vol. 65(3), pages 367-83, June.
  7. Huang, Kuo S. & Lin, Biing-Hwan, 2000. "Estimation Of Food Demand And Nutrient Elasticities From Household Survey Data," Technical Bulletins 33579, United States Department of Agriculture, Economic Research Service.
  8. Diansheng Dong & Chanjin Chung & Harry Kaiser, 2004. "Modelling milk purchasing behaviour with a panel data double-hurdle model," Applied Economics, Taylor & Francis Journals, vol. 36(8), pages 769-779.
  9. Einav, Liran & Leibtag, Ephraim S. & Nevo, Aviv, 2008. "On the Accuracy of Nielsen Homescan Data," Economic Research Report 56490, United States Department of Agriculture, Economic Research Service.
  10. Veeman, Michele M. & Peng, Yanning, 1997. "Canadian Dairy Demand," Project Report Series 24037, University of Alberta, Department of Resource Economics and Environmental Sociology.
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Cited by:
  1. C. Anirvinna, 2011. "A Tropical Country Which is Cool to Ice Creams!," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 11(4), pages 13-22.

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