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Demand Estimation In The Presence Of An Unobservable Product Attribute: The Case Of Mint Quality

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  • Toro-Gonzalez, Daniel
  • Yan, Jia
  • Gallardo, Rosa Karina
  • McCluskey, Jill J.

Abstract

This article estimates the demand for mint-flavored gum products using grocery store sales data and accounting for consumers’ valuation of quality. Unobserved product attributes, such as flavor quality, are important elements to consider when estimating the demand for gum. The estimation results suggest that gum is an inelastic product. A positive relationship between willingness to pay and unobserved quality was identified, implying that gum industry should be able to command a premium for higher quality mint flavored products.

Suggested Citation

  • Toro-Gonzalez, Daniel & Yan, Jia & Gallardo, Rosa Karina & McCluskey, Jill J., 2012. "Demand Estimation In The Presence Of An Unobservable Product Attribute: The Case Of Mint Quality," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 123518, Agricultural and Applied Economics Association.
  • Handle: RePEc:ags:aaea12:123518
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    References listed on IDEAS

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    More about this item

    Keywords

    Quality Differentiation; Unobserved Product Attributes; Demand Estimation; Gum; Consumer/Household Economics; Food Consumption/Nutrition/Food Safety; Industrial Organization;

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