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The Demand for Canadian Fats and Oils: A Case Study of Advertising Effectiveness

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  • Ellen W. Goddard
  • Alex K. Amuah

Abstract

The fats and oils market in Canada is characterized by generic (butter) and brand (margarine, shortening, vegetable oils) advertising. In this study the economic interrelationships in the consumption of fats and oils are examined and the effectiveness of the advertising programs is evaluated. The two-stage demand model used is made up of a single equation determining Canadian aggregate expenditure on fats and oils and an expenditure share system derived from a translog indirect utility function for each of four products; butter, margarine, shortening, and vegetable oils. The demand for individual fats and oils is significantly affected by lagged advertising expenditure levels, habit persistence and a time trend, as well as the traditional variables of price and expenditure.

Suggested Citation

  • Ellen W. Goddard & Alex K. Amuah, 1989. "The Demand for Canadian Fats and Oils: A Case Study of Advertising Effectiveness," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 71(3), pages 741-749.
    • Handle: RePEc:oup:ajagec:v:71:y:1989:i:3:p:741-749.
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