Traceability and Demand Sensitiveness: Evidences from Italian Fresh Potatoes Consumption
When a traceability system takes place, either when mandatory or voluntary, many questions arise that need to be addressed and answered. One of the firsts concerns whether it introduces new costs with no gain in efficiency or, on the contrary, the system efficiency increases lowering costs and, as a consequence, market price of the good in hand. Among others, another issue that only rarely is addressed regards the effect of a price change on the final market. The objective of this paper was to simulate the effect on fresh Italian vegetables market of prices change due to a newer traceability procedure, focusing on early potato. Reasons why early potato was the main object of our study will be explained in detail later in the paper. Moreover, this study concerns a demand system estimation that has, as main goal, the measurement of own and cross price elasticities as well as expenditure elasticities. Such estimations are not strictly related with traceability because they measure any change in quantity demanded due to price changes due to any market perturbation. However, since early potato is experiencing a peculiar market and chain change in Italy, our simulation is meant to reason in terms of a “what if” approach, formally simulating the effect of any change in price due to an hypothesis of traceability system involved. In order to estimate a demand system, real household consumption data (3,000 observations) of a statistically representative sample of the Italian population of households was taken into account. Relevant measures of market variables were estimated by means of a Linear Almost Ideal Demand System implementing a large set of fresh vegetables: potato split in early and late, cabbage, salad, mushrooms, fruits vegetables, roots, asparagus, onion, tomatoes, peppers, cucumbers, beans, zucchinis and others.
Volume (Year): 01 (2010)
Issue (Month): 4 ()
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- Dickinson, David L. & Bailey, DeeVon, 2002.
"Meat Traceability: Are U.S. Consumers Willing To Pay For It?,"
Journal of Agricultural and Resource Economics,
Western Agricultural Economics Association, vol. 27(02), December.
- David Dickinson & DeeVon Bailey, 2001. "Meat traceability: are U.S. consumers willing to pay for it?," Working Papers 2001-14, Utah State University, Department of Economics.
- David Dickinson & DeeVon Bailey, 2002. "Meat Traceability: Are U.S. Consumers Willing To Pay For It?," Working Papers 2002-07, Utah State University, Department of Economics.
- Dickinson, David L. & Bailey, DeeVon, 2002. "Meat Traceability: Are U. S. Consumers Willing To Pay For It?," 2002 Annual meeting, July 28-31, Long Beach, CA 19670, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
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