Elasticity of demand for sweetened and unsweetened drinks: the case of argentinian households
Argentina is the fourth highest consumer of sweetened drinks, and the first consumer of soda in the world. In this paper we estimate a quadratic almost ideal demand system (QUAIDS) to explore demand for a number of sweetened and unsweetened beverages in Argentina. We use two household surveys: the l...
| Main Authors: | , |
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| Format: | Conferencia |
| Language: | Inglés |
| Published: |
International Association of Agricultural Economists
2021
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| Subjects: | |
| Online Access: | http://hdl.handle.net/20.500.12123/8862 https://ageconsearch.umn.edu/record/277505 http://doi.org/10.22004/ag.econ.277505 |
| Summary: | Argentina is the fourth highest consumer of sweetened drinks, and the first consumer of soda in the world. In this paper we estimate a quadratic almost ideal demand system (QUAIDS) to explore demand for a number of sweetened and unsweetened beverages in Argentina. We use two household surveys: the last one available, performed in 2012-2013, and the previous one, carried over in 2004-2005. We explore expenditure shares and own and cross price elasticities. These results can shed light on a discussion that was held in 2017 in Congress towards the design of a tax reform on sweet beverages that will affect consumers, farmers, and the retail and food industries. Our results support the notion that a tax applied to highly sweetened beverages will affect consumption: for every 1% increase in price there will be a 1.32% drop in quantity purchased. In addition,we find that for every 1% price increase in highly sweetened beverages there will be a 1.12% increase in the amount of dairy beverages purchased. |
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