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The Demand for Dairy Products: Structure, Prediction, and Decomposition


  • Dale M. Heien
  • Cathy Roheim Wessells


This article presents an analysis of the demand for dairy products. First, the structure of dairy product demand is estimated using the Household Food Consumption Survey data. Under the assumption of a two-stage budgeting procedure, a complete demand system for food incorporating demographic effects is estimated. Next, using the demand relations estimated from cross-section data, prediction interval tests utilizing time-series data are performed for milk and butter. Last, factors affecting consumption are classified into economic and demographic effects and a decomposition of the causes of changes in demand over time is performed.

Suggested Citation

  • Dale M. Heien & Cathy Roheim Wessells, 1988. "The Demand for Dairy Products: Structure, Prediction, and Decomposition," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 70(2), pages 219-228.
  • Handle: RePEc:oup:ajagec:v:70:y:1988:i:2:p:219-228.

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    1. repec:ags:aareaj:280248 is not listed on IDEAS
    2. Hayley H. Chouinard & David E. Davis & Jeffrey T. LaFrance & Jeffrey M. Perloff, 2010. "Milk Marketing Order Winners and Losers," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 32(1), pages 59-76.
    3. Beghin, John C. & Meade, Birgit & Rosen, Stacey, 2014. "A Consistent Food Demand Framework for International Food Security Assessment," Staff General Research Papers Archive 38196, Iowa State University, Department of Economics.
    4. Chouinard, Hayley H & Davis, David E. & LaFrance, Jeffrey T. & Perloff, Jeffrey M, 2005. "The Effects of a Fat Tax on Dairy Products," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt60t1f3tn, Department of Agricultural & Resource Economics, UC Berkeley.
    5. Neff, Steven A., 1990. "An Economic Analysis Of The Impact Of Removing U.S. Import Quotas On Dairy Products," 1990 Annual meeting, August 5-8, Vancouver, Canada 270857, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    6. Helen Jensen & Justo Manrique, 1998. "Demand for food commodities by income groups in Indonesia," Applied Economics, Taylor & Francis Journals, vol. 30(4), pages 491-501.
    7. repec:eee:jpolmo:v:39:y:2017:i:5:p:827-842 is not listed on IDEAS
    8. Chouinard Hayley H & Davis David E & LaFrance Jeffrey T & Perloff Jeffrey M, 2007. "Fat Taxes: Big Money for Small Change," Forum for Health Economics & Policy, De Gruyter, vol. 10(2), pages 1-30, June.
    9. repec:oup:revage:v:31:y:2009:i:3:p:424-445. is not listed on IDEAS
    10. Brian W. Gould & Huei Chin Lin, 1994. "The demand for cheese in the United States: The role of household composition," Agribusiness, John Wiley & Sons, Ltd., vol. 10(1), pages 43-59.
    11. repec:ags:gewipr:259063 is not listed on IDEAS
    12. Mccorriston, Steve & Sheldon, Ian, 1989. "Imperfect Competition, Trade Policy and Processed Agricultural Products," Occasional Papers 232831, Regional Research Project NC-194: Organization and Performance of World Food Systems.
    13. Metin Cakir & Joseph V. Balagtas, 2010. "Econometric evidence of cross-market effects of generic dairy advertising," Agribusiness, John Wiley & Sons, Ltd., vol. 26(1), pages 83-99.
    14. Bailey, Kenneth W., 2000. "Evaluating The Economic Impacts Of Regional Milk Pricing Authorities: The Case Of Dairy Compacts," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 29(2), pages 1-12, October.
    15. Astrid Jonas & Jutta Roosen, 2008. "Demand for milk labels in Germany: organic milk, conventional brands, and retail labels," Agribusiness, John Wiley & Sons, Ltd., vol. 24(2), pages 192-206.
    16. Traore, Togo M. & Fields, Deacue, 2016. "Households Demand for Staple Cereal Commodities in Burkina Faso," 2016 Annual Meeting, February 6-9, 2016, San Antonio, Texas 229989, Southern Agricultural Economics Association.

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