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Retail Demand For Whole Vs. Low-Fat Milk: New Perspectives On Loss Leader Pricing

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Listed:
  • Green, Geoffrey M.
  • Park, John L.

Abstract

This analysis employed retail scanner data to investigate the demand for fluid mild differentiated by fat content. All own-price elasticities were significant and negative. Demand for low-fat milk was elastic, while demand for whole milk was inelastic. This article addresses the use of milk as a loss leader.

Suggested Citation

  • Green, Geoffrey M. & Park, John L., 1998. "Retail Demand For Whole Vs. Low-Fat Milk: New Perspectives On Loss Leader Pricing," 1998 Annual meeting, August 2-5, Salt Lake City, UT 20827, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea98:20827
    DOI: 10.22004/ag.econ.20827
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    References listed on IDEAS

    as
    1. Jensen, Kim, 1995. "Fluid Milk Purchase Patterns in the South: Effects of Use of Nutrition Information and Household Characteristics," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 27(2), pages 644-657, December.
    2. Capps, Oral, Jr. & Lambregts, Johannes Adrianus, 1991. "Assessing Effects Of Prices And Advertising On Purchases Of Finfish And Shellfish In A Local Market In Texas," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 23(1), pages 1-14, July.
    3. Oral Capps, 1989. "Utilizing Scanner Data to Estimate Retail Demand Functions for Meat Products," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 71(3), pages 750-760.
    4. Gould, Brian W., 1996. "Factors Affecting U.S. Demand For Reduced-Fat Fluid Milk," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 21(1), pages 1-14, July.
    5. 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.
    6. Oral Capps & Rodolfo M. Nayga, 1991. "Demand for fresh beef products in supermarkets: A trial with scanner data," Agribusiness, John Wiley & Sons, Ltd., vol. 7(3), pages 241-251.
    7. Eastwood, David B. & Gray, Morgan D. & Brooker, John R., 1994. "Supermarket Patronage: An Analysis Of Customer Counts Among Outlets Within A Geographic Area," Journal of Food Distribution Research, Food Distribution Research Society, vol. 25(2), pages 1-9, September.
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    Cited by:

    1. Basak Canan & Ronald W. Cotterill, 2006. "Strategic pricing in a differentiated product oligopoly model: fluid milk in Boston," Agricultural Economics, International Association of Agricultural Economists, vol. 35(1), pages 27-33, July.
    2. Bergtold, Jason S. & Akobundu, Eberechukwu & Peterson, Everett B., 2004. "The FAST Method: Estimating Unconditional Demand Elasticities for Processed Foods in the Presence of Fixed Effects," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 29(2), pages 1-20, August.
    3. Maynard, Leigh J. & Liu, Deyu, 1999. "Fragility In Dairy Product Demand Analysis," 1999 Annual meeting, August 8-11, Nashville, TN 21679, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    4. Maynard, Leigh J., 2000. "Empirical Tests Of The Argument That Consumers Value Stable Retail Milk Prices," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 18(2), pages 1-18.
    5. Gulgun Yildiz Tiryaki & Cuma Akbay, 2010. "Consumers’ fluid milk consumption behaviors in TURKEY: an application of multinomial logit model," Quality & Quantity: International Journal of Methodology, Springer, vol. 44(1), pages 87-98, January.
    6. Glauben, Thomas & Hansen, Kristin & Loy, Jens-Peter & Weiss, Christoph R., 2011. "Breadth and depth of promotional sales in food retailing," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 57(3), pages 145-149.
    7. Navid Mojir & K. Sudhir, 2014. "A Model of Multi-pass Search: Price Search across Stores and Time," Cowles Foundation Discussion Papers 1942R2, Cowles Foundation for Research in Economics, Yale University, revised Feb 2020.

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