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The returns to promotion of healthy choices in Tasmania: are you in the dark about the power of mushrooms?

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  • Julian M. Alston
  • Joanna C. Parks

Abstract

The Australian Mushroom Growers Association (AMGA) has recently developed a revised marketing strategy to promote mushrooms using messages based on scientific findings about the nutrition and health consequences of regularly incorporating mushrooms into meals. This article evaluates impacts based on a test-market experiment in Tasmania. We use a difference-in-differences econometric methodology to quantify the programme-induced shifts in demand, and we use the resulting estimates in a supply and demand modelling framework to quantify the effects of promotion-induced demand shifts on prices, quantities, and measures of economic well-being. We estimate a conservative benefit–cost ratio for Tasmanian producers of 7.6:1 if they were to bear the entire cost and 11.4:1 if the programme were financed by a levy on production (or spawn). The aggregate benefit–cost ratio, including benefits to consumers is also 11.4:1. 1
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  • Julian M. Alston & Joanna C. Parks, 2012. "The returns to promotion of healthy choices in Tasmania: are you in the dark about the power of mushrooms?," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 56(3), pages 347-365, July.
    • Handle: RePEc:bla:ajarec:v:56:y:2012:i:3:p:347-365
    DOI: j.1467-8489.2011.00577.x
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    1. Julian M. Alston & John M. Crespi & Harry M. Kaiser & Richard J. Sexton, 2007. "An Evaluation of California's Mandated Commodity Promotion Programs," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 29(1), pages 40-63.
    2. Okrent, Abigail M. & Alston, Julian M., 2011. "Demand for Food in the United States: A Review of Literature, Evaluation of Previous Estimates, and Presentation of New Estimates of Demand," Monographs, University of California, Davis, Giannini Foundation, number 251908, December.
    3. Joshua D. Angrist & Jörn-Steffen Pischke, 2009. "Mostly Harmless Econometrics: An Empiricist's Companion," Economics Books, Princeton University Press, edition 1, number 8769.
    4. Tim Hazledine & Hsin Huang, 1990. "Price-discriminating Marketing Board with Imperfect Supply Control: A Case of B.C. Mushrooms," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 38(1), pages 67-88, March.
    5. Cameron,A. Colin & Trivedi,Pravin K., 2005. "Microeconometrics," Cambridge Books, Cambridge University Press, number 9780521848053, October.
    6. Carol Horton Tremblay & Victor J. Tremblay, 1995. "The Impact Of Cigarette Advertising On Consumer Surplus, Profit, And Social Welfare," Contemporary Economic Policy, Western Economic Association International, vol. 13(1), pages 113-124, January.
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