Economic and demographic factors affecting US demand for lunch meats

Abstract

Consumer demand analyses of meats have seldom included processed meats, particularly lunch meats. In this study, we examine retail lunch meat data from Nielsen 2006 Homescan. The objective of this study is to determine the impact of retail prices, expenditure, and demographic variables on eight lunch meat products. A censored AIDS model is used to estimate the demand for lunch meat products. Results reveal that own-price elasticities are elastic for all lunch meat categories. The expenditure elasticities are elastic for four lunch meat products and inelastic for the remaining products and demographic variables have statistically significant impacts on lunch meat purchases.

Keywords:

• Demographics
• processed meats
• Nielsen Homescan

Acknowledgments

The authors thank Purdue University and the Economic Research Service, USDA for establishing a cooperative agreement to conduct meat demand analyses on homescan and grocery store scanner data.

Notes

1. Fixed-weight and random-weight are adjectives used by retailers to describe two broad classes of products. Fixed-weight products come prepackaged in specific weights or volumes. A package of bologna would be an example of a fixed-weight product. Random-weight products are those that do not come in a pre-determined size. The bologna that one buys at the service deli is a random-weight product.