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THREE ESSAYS ON FOOD ECONOMICS STUDIES

Abstract
In this dissertation research, we first study how legislations governing nutrients in food production have influenced consumer behaviors and firm choices. Taking margarine and spreads as the product category of choice, Chapter 1 analyzes how consumers and firms responded to the 2006 implementation of the NLEA trans fats labeling guidelines. Our results show that product offerings with “trans fat free” labels increased shortly after 2006, while consumer purchases of products with “trans fat free” labels also surged promptly after the labeling policy was implemented. However, in general, we find the short-term effects of trans fat labeling to be significantly larger than the long-term effects. In Chapter 2, we extend the previous research in estimating consumers’ willingness to pay for trans fat using scanner data on purchases of microwavable popcorn from 2006 to 2014, after mandatory labeling was instituted. Product-level multinomial logit model results suggest that trans fat content on average increases consumer demand, with significant regional preference heterogeneity. Consumers in the Northeast have a higher preference for trans fat popcorn than in the other three regions. In addition, we find evidence to show that this positive preference for trans fat has become stronger since the 2006 mandatory labeling rule, implying that consumers value the taste of trans fat over trans fat health concerns. Chapter 3 explores the WIC infant formula rebate program, which awards a single-source contract to the firm that offers the lowest net bid price. We find different spillover patterns by comparing three types of formula: top WIC infant formula, non-WIC infant formula, and toddler formula. In particular, immediately after the contract change, there is a significant increase in market share for all three types of formula for the winning manufacturer due to greater shelf space, better product placement, and the advantages of carrying WIC labels. Our empirical results suggest that losing manufacturers still enjoy a spillover privilege in the toddler formula market from consumers’ brand loyalty. Over time, the spillover effect increases the winner’s share and decreases the losers’ shares for all infant formula, which may reflect a combined impact of recommendations from physicians and WIC participants. Lastly, we observe that winning manufacturers increase the price of top WIC and all other infant formula and decrease the price of toddler formula over time. The spillover effect allows losing manufacturers to increase prices for all three types of formula at least 2 years after a contract change.
Type
openaccess
dissertation
Date
2018-09-01
Publisher
Rights
License