Author ORCID Identifier
https://orcid.org/0000-0002-9259-2319
Date Available
5-9-2025
Year of Publication
2024
Degree Name
Doctor of Philosophy (PhD)
Document Type
Doctoral Dissertation
College
Agriculture, Food and Environment
Department/School/Program
Agricultural Economics
First Advisor
Dr. Timothy A. Woods
Second Advisor
Dr. Yuqing Zheng
Abstract
This dissertation, by leveraging advanced econometric modeling approaches and exploiting suitable large datasets, investigates consumer food product demand in a setting of change in regulating policies as well as unforeseen price increases. Three chapters have mainly enabled the dissertation to achieve its research goals, which have been explicitly presented in Chapter 1 along with the background as well as the core problem the studies have elaborated on.
Given that soft drinks stand out as a major cause of obesity and overweight worldwide, whereas the United States is the country most concerned with this problem, experts have agreed that labels and taxes represent promising policy tools to reverse the situation. Therefore, focusing on the soda market, Chapter 2 investigates how consumer demand for nutrient contents responds to the U.S. revised nutrition facts label policy implemented in 2020. Relying on retail scanner data, the study finds after estimation of a structural discrete choice logit model that the change in nutrition labels caused consumers to modify their purchasing behavior. However, they did not systematically switch from unhealthy beverages to healthy ones. The analysis finds evidence that the label revision policy was mostly impactful in decreasing consumers’ preference for soda with superhigh calories and high-sugar content. Surprisingly, the joint effect of label and tax did not decrease the sampled consumers’ preference for unhealthy nutrient contents. They still preferred buying soft drinks superhigh in calorie content inside U.S. cities with a tax on sugar-sweetened beverages (SSB), despite the revision of the facts label. Finally, the new nutrition label has improved the average surplus of consumers and total welfare. However, the gain is lower within the cities implementing the sugar tax.
Chapter 3 examines the causal effects of Supplemental Nutrition Assistance Program (SNAP) benefit enhancements on eligible food expenditures, the fiscal years 2020 and 2021 considered. Through a quasi-experimental research design embedded in a difference-in-difference estimation method, the research uses Consumer Expenditure Diary Survey data to yield interesting results. The study informs that enrolled households adjust their spending behavior in response to boosts in in-kind transfers. However, on eligible foods, increases in the program allocation levels disproportionately impacted participants’ spending. Estimates have undergone several sensitivity checks which successfully validate their robustness. Since the impacts of the benefit increase on the SNAP-eligible food expenditure seem ambiguous, therefore, as the main policy implication, the study suggests that achieving a more meaningful impact requires food assistance experts to design for each qualified food group, a threshold of expenses aligning with standard balanced diet requirement.
Chapter 4 explores the factors that determine U.S. household expenditure patterns for food products in the context of exceptional price shocks due to the COVID-19 pandemic. This research relied on the Consumer Expenditure Diary Survey (CEX) for the year 2020, where households or consumer units represent units of observation to estimate the Heckman two-step model. Consistent with the inelastic nature of food products, the findings inform that conditional expenditure elasticities of income were less than one for all kinds of food, including food-away-from-home (FAFH). The results show both food and FAFH to be highly price elastic in this special period of higher food prices. For instance, a 1% increase in own price implied a 7.78% decrease in the probability to spend on food and a 20.93% decrease in propensity to purchase FAFH. Business managers and marketing experts have been provided with insights on the consumer profile and food product price strategy, as a noticeable implication.
Digital Object Identifier (DOI)
https://doi.org/10.13023/etd.2024.200
Funding Information
University of Kentucky, Department of Agricultural Economics, Scholarship, 2020 - 2024.
Recommended Citation
Codjia, Clement Olivier, "CONSUMER DEMAND FOR FOOD PRODUCTS, PRICE SURGE, AND U.S. PUBLIC POLICY: AN EMPIRICAL ECONOMIC ANALYSIS" (2024). Theses and Dissertations--Agricultural Economics. 107.
https://uknowledge.uky.edu/agecon_etds/107
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