IDEAS home Printed from https://ideas.repec.org/a/wly/ajagec/v105y2023i5p1491-1515.html
   My bibliography  Save this article

New insights into the structure of consumer preferences for natural and artificial sweeteners

Author

Listed:
  • Vardges Hovhannisyan
  • Christopher T. Bastian

Abstract

This study utilizes the Generalized Exact Affine Stone Index demand system to investigate the structure of demand for natural and artificial sweeteners in the United States based on uniquely disaggregate data. Our empirical framework allows for arbitrarily complex Engel curves, unobserved consumer heterogeneity and potential precommitments in sweetener consumption, while addressing price endogeneity. Results from a series of weak separability tests reveal that consumers select from among both sets of natural and artificial sweeteners. In addition, most sweeteners are empirically established to be consumed in precommitted quantities, with the shares thereof varying from 6.3% for molasses to 34.4% for granulated sugar. Based on the unconditional elasticities obtained via a two‐stage budgeting framework, we further examine the implications of hypothetical sweetener tax scenarios for consumer energy intake and bodyweight, as well as assess the consumer welfare consequences thereof.

Suggested Citation

  • Vardges Hovhannisyan & Christopher T. Bastian, 2023. "New insights into the structure of consumer preferences for natural and artificial sweeteners," American Journal of Agricultural Economics, John Wiley & Sons, vol. 105(5), pages 1491-1515, October.
    • Handle: RePEc:wly:ajagec:v:105:y:2023:i:5:p:1491-1515
    DOI: 10.1111/ajae.12362
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/ajae.12362
    Download Restriction: no
    File URL: https://libkey.io/10.1111/ajae.12362?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Zagorsky, Jay L. & Smith, Patricia K., 2020. "Who drinks soda pop? Economic status and adult consumption of sugar-sweetened beverages," Economics & Human Biology, Elsevier, vol. 38(C).
    2. Hovhannisyan, Vardges & Kondaridze, Magdana & Bastian, Christopher & Shanoyan, Aleksan, 2020. "Empirical Evidence of Changing Food Demand and Consumer Preferences in Russia," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 52(3), pages 480-501, August.
    3. Zhen Miao & John C. Beghin & Helen H. Jensen, 2012. "Taxing Sweets: Sweetener Input Tax Or Final Consumption Tax?," Contemporary Economic Policy, Western Economic Association International, vol. 30(3), pages 344-361, July.
    4. Hovhannisyan, Vardges & Shanoyan, Aleksan, 2019. "Addressing Pre-Commitment Bias with a Generalized EASI Model: An Application to Food Demand in Russia," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 44(1), January.
    5. David L. Edgerton, 1997. "Weak Separability and the Estimation of Elasticities in Multistage Demand Systems," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(1), pages 62-79.
    6. Smith, Travis A. & Lin, Biing-Hwan & Morrison, Rosanna Mentzer, 2010. "Taxing Caloric Sweetened Beverages To Curb Obesity," Amber Waves:The Economics of Food, Farming, Natural Resources, and Rural America, United States Department of Agriculture, Economic Research Service, pages 1-6.
    7. Vardges Hovhannisyan & Marin Bozic, 2017. "Price Endogeneity and Food Demand in Urban China," Journal of Agricultural Economics, Wiley Blackwell, vol. 68(2), pages 386-406, June.
    8. R. H. Strotz, 1955. "Myopia and Inconsistency in Dynamic Utility Maximization," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 23(3), pages 165-180.
    9. Brian W. Gould, 2003. "An Empirical Assessment of Endogeneity Issues in Demand Analysis for Differentiated Products," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(3), pages 605-617.
    10. Arthur Lewbel & Krishna Pendakur, 2009. "Tricks with Hicks: The EASI Demand System," American Economic Review, American Economic Association, vol. 99(3), pages 827-863, June.
    11. Giancarlo Moschini & Daniele Moro & Richard D. Green, 1994. "Maintaining and Testing Separability in Demand Systems," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 76(1), pages 61-73.
    12. Alessandro Bonanno & Rui Huang & Yizao Liu, 2015. "Editor's choice Simulating welfare effects of the European nutrition and health claims’ regulation: the Italian yogurt market," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 42(3), pages 499-533.
    13. Hausman, Jerry A, 1981. "Exact Consumer's Surplus and Deadweight Loss," American Economic Review, American Economic Association, vol. 71(4), pages 662-676, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Cao, Ting & House, Lisa A. & Gao, Zhifeng & Wang, Yu, 2024. "Consumer Preferences for Sweeteners in Energy Drinks Exploring the Taste: Consumer Choice of Sweeteners in Energy Beverages," 2024 Annual Meeting, July 28-30, New Orleans, LA 343906, Agricultural and Applied Economics Association.
    2. Utsunomiya, Ryo & Nakatani, Tomoaki & Nakashima, Yasuhiro, 2024. "Purchases for Family: Heterogeneity of Demand Responses to Changes in Price and Expenditure," IAAE 2024 Conference, August 2-7, 2024, New Delhi, India 344311, International Association of Agricultural Economists (IAAE).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hovhannisyan, Vardges & Bastian, Christopher T., 2022. "Consumption of Low-Intensity and High-Intensity Sweeteners in the United States: Structure, Drivers, and Policy Implications," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322508, Agricultural and Applied Economics Association.
    2. Kazi Tamim Rahman & Aleksan Shanoyan & Vardges Hovhannisyan, 2024. "Food commodity price changes and consumer welfare in Bangladesh: Valuable lessons for today," Journal of Agricultural Economics, Wiley Blackwell, vol. 75(1), pages 169-188, February.
    3. Korir, Lilian & Rizov, Marian & Ruto, Eric, 2020. "Food security in Kenya: Insights from a household food demand model," Economic Modelling, Elsevier, vol. 92(C), pages 99-108.
    4. Hovhannisyan, Vardges & Shanoyan, Aleksan, 2018. "An Empirical Analysis Of Welfare Consequences Of Rising Food Prices In Urban China: The Easi Approach," 2018 Annual Meeting, August 5-7, Washington, D.C. 273987, Agricultural and Applied Economics Association.
    5. Hovhannisyan, Vardges & Bastian, Christopher T. & Devadoss, Stephen, 2020. "An Empirical Analysis of Tobacco Addiction," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304425, Agricultural and Applied Economics Association.
    6. Ghazaryan, Armen & Bonanno, Alessandro & Carlson, Andrea, 2023. "I Say Milk, You Say Mylk. Demand Separability in a Broadened Milk Category," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 48(2), May.
    7. Lakkakula, Prithviraj & Schmitz, Andrew & Ripplinger, David, 2016. "U.S. Sweetener Demand Analysis: A QUAIDS Model Application," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 41(3), pages 1-16, September.
    8. Bakhtavoryan, Rafael & Capps, Jr., Oral, . "A Demand Systems Analysis for Cheese Varieties Using a Balanced Panel of US-Designated Market Areas, 2018–2020," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 49(2).
    9. Bakhtavoryan, Rafael & Hovhannisyan, Vardges, 2024. "Residential demand for energy in light of changing solar prices," 2024 Annual Meeting, July 28-30, New Orleans, LA 343883, Agricultural and Applied Economics Association.
    10. Shashika D. Rathnayaka & Saroja Selvanathan & E. A. Selvanathan, 2021. "Demand for animal‐derived food in selected Asian countries: A system‐wide analysis," Agricultural Economics, International Association of Agricultural Economists, vol. 52(1), pages 97-122, January.
    11. Vardges Hovhannisyan & Aleksan Shanoyan, 2020. "An Empirical Analysis of the Welfare Consequences of Rising Food Prices in Urban China: The Easi Approach," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 42(4), pages 796-814, December.
    12. Hovhannisyan, Vardges, 2016. "New Evidence On The Structure Of Food Demand In China: An Easi Demand Model Estimated Via Panel Data Techniques," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 236889, Agricultural and Applied Economics Association.
    13. Janda, Karel & Rausser, Gordon C. & McCluskey, Jill, 1998. "Food import demand in the Czech Republic," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt14j5p75j, Department of Agricultural & Resource Economics, UC Berkeley.
    14. Dhar, Tirtha & Chavas, Jean- Paul & Cotterill, Ronald W. & Gould, Brian W., 2005. "An Economic Analysis of Brand-Level Strategic Pricing Between Coca-Cola Company and Pepsi," Working Papers 201538, University of Wisconsin-Madison, Department of Agricultural and Applied Economics, Food System Research Group.
    15. Arthur Lewbel & Krishna Pendakur, 2017. "Unobserved Preference Heterogeneity in Demand Using Generalized Random Coefficients," Journal of Political Economy, University of Chicago Press, vol. 125(4), pages 1100-1148.
    16. Bo Xiong & Daniel Sumner & William Matthews, 2014. "A new market for an old food: the U.S. demand for olive oil," Agricultural Economics, International Association of Agricultural Economists, vol. 45(S1), pages 107-118, November.
    17. Rahman, Kazi Tamim & Shanoyan, Aleksan & Hovhannisyan, Vardges, 2021. "Food Commodity Price Hikes, Public Policy, and Consumer Welfare: Lessons from Bangladesh," 2021 Annual Meeting, August 1-3, Austin, Texas 314076, Agricultural and Applied Economics Association.
    18. Dong, Diansheng & Stewart, Hayden & Dong, Xiao & Hahn, William, 2022. "Quantifying Consumer Welfare Impacts of Higher Meat Prices During the COVID-19 Pandemic," Amber Waves:The Economics of Food, Farming, Natural Resources, and Rural America, United States Department of Agriculture, Economic Research Service, vol. 2022(Economic ), April.
    19. Vardges Hovhannisyan & Sachintha Mendis & Chris Bastian, 2019. "An econometric analysis of demand for food quantity and quality in urban China," Agricultural Economics, International Association of Agricultural Economists, vol. 50(1), pages 3-13, January.
    20. Stefan Hoderlein & Anne Vanhems, 2018. "Estimating the distribution of welfare effects using quantiles," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 33(1), pages 52-72, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:ajagec:v:105:y:2023:i:5:p:1491-1515. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://doi.org/10.1111/(ISSN)1467-8276 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.