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Demand for Food Away from Home: A Multiple Discrete/Continuous Extreme Value Model

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  • Richards, Timothy J.
  • Mancino, Lisa

Abstract

Policymakers have suggested the use of taxes to raise the relative cost of buying fast food. Yet, little is known of the structure of demand for food-away-from-home (FAFH) in general. This study provides estimates of the price-elasticity of demand for four different types of FAFH using a new dataset from NPD, Inc. and an econometric approach that accounts for the multiple discrete / continuous nature of FAFH demand. We find that cross-price elasticities of demand are small, so consumers are unwilling to substitute between FAH and any type of FAFH or among types of FAFH. Therefore, taxing fast food may be effective in reducing the number of fast food visits and shifting consumption to at-home meals.

Suggested Citation

  • Richards, Timothy J. & Mancino, Lisa, 2012. "Demand for Food Away from Home: A Multiple Discrete/Continuous Extreme Value Model," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 127103, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae12:127103
    DOI: 10.22004/ag.econ.127103
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    References listed on IDEAS

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    Keywords

    Consumer/Household Economics; Food Consumption/Nutrition/Food Safety; Marketing;
    All these keywords.

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