Consumer Responses to Recent BSE Events

Abstract

Recent bovine spongiform encephalopathy (BSE, a.k.a. mad cow disease) discoveries in Canadian and U.S. beef cattle have garnered significant media attention, which may have changed consumers’ meat-purchasing behavior. Consumer response is hypothesized and tested within a meat demand system in which response is measured using single-period dummy variables, longer-term dummy variables, and media indices that count positive and negative meat-industry articles. Parameters are estimated using retail scanner data, and cross-species price elasticities are calculated. Results suggest that the BSE events negatively impacted ground beef and chuck roasts, while positively impacting center-cut pork chop demand. Dummy variables explained the variation in meat-budget shares better than did media indices.