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Weather Effects on Household Demand for Coffee and Tea in Japan

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  • Michael Fesseha Yohannes
  • Toshinobu Matsuda

Abstract

ABSTRACT This paper estimates the weather effects on household demand for coffee and tea in Japan using the linear approximate quadratic almost ideal demand system model (LA/QUAIDS). Five expenditure shares and prices demand equations for coffee and tea group: green tea, black tea, tea beverage, coffee, and coffee beverage are estimated for two or more households in 49 cities, for the period January 2000 through March 2012. Empirical results show that demand for green tea, black tea, and tea beverage are own‐price elastic while coffee and coffee beverage are own‐price inelastic. The expenditure elasticity estimates that green tea and black tea are luxuries, while tea beverage, coffee and coffee beverage are necessities in the Japanese household. In addition, temperature has a positive effect on demand for tea beverage and coffee beverage and has a negative effect on green tea, black tea and coffee throughout the year. [EconLit citations: D12, Q11].

Suggested Citation

  • Michael Fesseha Yohannes & Toshinobu Matsuda, 2016. "Weather Effects on Household Demand for Coffee and Tea in Japan," Agribusiness, John Wiley & Sons, Ltd., vol. 32(1), pages 33-44, January.
    • Handle: RePEc:wly:agribz:v:32:y:2016:i:1:p:33-44
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    File URL: http://hdl.handle.net/10.1002/agr.21434
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    2. Oral Capps & Muxi Cheng & Jennifer Kee & Samuel L. Priestley, 2023. "A cross‐sectional analysis of the demand for coffee in the United States," Agribusiness, John Wiley & Sons, Ltd., vol. 39(2), pages 494-514, March.

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