Determinants of Food Expenditure Patterns: Evidence from U.S. Consumers in the Context of the COVID-19 Price Shocks

Clement O. Codjia; Sayed H. Saghaian

doi:10.3390/su14138156

Determinants of Food Expenditure Patterns: Evidence from U.S. Consumers in the Context of the COVID-19 Price Shocks

Clement O. Codjia, Sayed H. Saghaian

Agricultural Economics

Research output: Contribution to journal › Article › peer-review

2 Scopus citations

Abstract

This study examined the factors that determine U.S. household expenditure patterns for food products in the context of exceptional price shocks due to the COVID-19 pandemic. This research relied on the Consumer Expenditure Diary Survey (CEX) for the year 2020, where households or consumer units represent units of observation. With a sample size of 10,453 observations, the empirical estimation of the Heckman two-step model yields interesting results. Consistent with the inelastic nature of food products, we found conditional expenditure elasticities of income were less than one for all kinds of food, including food away from home (FAFH). The results showed both food and FAFH to be highly price elastic in this special period of higher food prices. For instance, a 1% increase in own price implied a 7.78% decrease in the probability to spend on food and a 20.93% decrease in propensity to purchase FAFH. This study provides business managers and marketing experts with insights on the consumer profile and food product price strategy.

Original language	English
Article number	8156
Journal	Sustainability (Switzerland)
Volume	14
Issue number	13
DOIs	https://doi.org/10.3390/su14138156
State	Published - Jul 1 2022

Bibliographical note

Funding Information:
Acknowledgments: The authors thank the reviewers and editors for their hardwork. Sayed H. Saghaian acknowledges the support from the United States Department of Agriculture, National Institute of Food and Agriculture, Hatch project No. KY004052, under accession number 1012994.

Publisher Copyright:
© 2022 by the authors. Licensee MDPI, Basel, Switzerland.

Keywords

Heckman two-step model
U.S. households
food
food away from home

ASJC Scopus subject areas

Computer Science (miscellaneous)
Geography, Planning and Development
Renewable Energy, Sustainability and the Environment
Building and Construction
Environmental Science (miscellaneous)
Energy Engineering and Power Technology
Hardware and Architecture
Computer Networks and Communications
Management, Monitoring, Policy and Law

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

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10.3390/su14138156

Cite this

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abstract = "This study examined the factors that determine U.S. household expenditure patterns for food products in the context of exceptional price shocks due to the COVID-19 pandemic. This research relied on the Consumer Expenditure Diary Survey (CEX) for the year 2020, where households or consumer units represent units of observation. With a sample size of 10,453 observations, the empirical estimation of the Heckman two-step model yields interesting results. Consistent with the inelastic nature of food products, we found conditional expenditure elasticities of income were less than one for all kinds of food, including food away from home (FAFH). The results showed both food and FAFH to be highly price elastic in this special period of higher food prices. For instance, a 1% increase in own price implied a 7.78% decrease in the probability to spend on food and a 20.93% decrease in propensity to purchase FAFH. This study provides business managers and marketing experts with insights on the consumer profile and food product price strategy.",

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Determinants of Food Expenditure Patterns: Evidence from U.S. Consumers in the Context of the COVID-19 Price Shocks

Abstract

Bibliographical note

Keywords

ASJC Scopus subject areas

UN SDGs

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