THE IMPACT OF INCOME ON HOUSEHOLD EXPENDITURE ON DAIRY PRODUCTS: EVIDENCE FROM THE UNITED STATES DAIRY MARKET

Abstract

This paper uses the diary portion of the 2016 Consumer Expenditure Survey to study the impact of income on dairy product expenditure in the United States using the Tobit model. Results show that the effect of income is positive and significant. However, as income increases, households introduce more dairy products into their consumption bundle. Low-income households who are eligible for the Supplemental Nutrition Assistance Program would get benefit from this program as the effect of this program on dairy product expenditure is also positive and significant. The study suggests that this information needs to be used by public sectors when formulating their health-promoting programs, and also by food retailers when making their market strategies.