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Product Differentiation and Brand Competition in the Italian Breakfast Cereal Market: a Distance Metric Approach

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  • Sckokai, Paolo
  • Varacca, Alessandro

Abstract

This article employs a nation-wide sample of supermarket scanner data to study product and brand competition in the Italian breakfast cereal market. A modified Almost Ideal Demand System (AIDS), that includes Distance Metrics (DMs) as proposed by Pinkse, Slade and Brett (2002), is estimated to study demand responses, substitution patterns, own-price and cross-price elasticities. Estimation results provide evidence of some degree of brand loyalty, while consumers do not seem loyal to the product type. Elasticity estimates point out the presence of patterns of substitution within products sharing the same brand and similar nutritional characteristics.

Suggested Citation

  • Sckokai, Paolo & Varacca, Alessandro, 2012. "Product Differentiation and Brand Competition in the Italian Breakfast Cereal Market: a Distance Metric Approach," Bio-based and Applied Economics Journal, Italian Association of Agricultural and Applied Economics (AIEAA), vol. 1(3), pages 1-16, December.
    • Handle: RePEc:ags:aieabj:146277
    DOI: 10.22004/ag.econ.146277
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    References listed on IDEAS

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    Cited by:

    1. Romano, Donato, 2012. "The Bio-based Economy: a New Development Model," Bio-based and Applied Economics Journal, Italian Association of Agricultural and Applied Economics (AIEAA), vol. 1(3), pages 1-3, December.

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    More about this item

    Keywords

    Demand and Price Analysis;

    JEL classification:

    • Q11 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Aggregate Supply and Demand Analysis; Prices
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

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