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The Price of Happy Hens: A Hedonic Analysis of Retail Egg Prices

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  • Chang, Jae Bong
  • Lusk, Jayson L.
  • Norwood, F. Bailey

Abstract

This paper analyzes price differentials among conventional, cage-free, organic, and Omega-3 eggs using retail scanner data from two regional markets and the United States as a whole. Results reveal significant premiums attributable to cage-free (a 57% premium on average) and organic (an 85% premium on average). However, significant variation exists among geographic locations; price premiums for organic over conventional eggs in Dallas are almost twice as high as those in San Francisco. Estimates indicate that about 42% of the typically observed premium for cage-free eggs over conventional eggs (and 36% of the premium for organic eggs) can be attributed to egg color rather than differences in hens’ living conditions. Despite the large implicit price premiums for cage-free and organic, our data reveal that most shoppers are not willing to pay such high prices for cage-free and organic attributes.

Suggested Citation

  • Chang, Jae Bong & Lusk, Jayson L. & Norwood, F. Bailey, 2010. "The Price of Happy Hens: A Hedonic Analysis of Retail Egg Prices," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 35(3), pages 1-18, December.
  • Handle: RePEc:ags:jlaare:97855
    DOI: 10.22004/ag.econ.97855
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    File URL: https://ageconsearch.umn.edu/record/97855/files/JARE_Dec2010__04F_pp406-423.pdf
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    References listed on IDEAS

    as
    1. Lusk Jayson L, 2010. "The Effect of Proposition 2 on the Demand for Eggs in California," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 8(1), pages 1-20, April.
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