Consumers demand for products with animal welfare attributes: evidence from Homescan data for Scotland

The purpose of this paper is to assess Scottish consumers’ demand for animal welfare andorganic pork. The paper also tried to answer the following questions: (1) Are animal-friendly pork andorganic pork complements or substitutes (competing)? (2) What is the relationship between porkproducts with different animal welfare labels (i.e. “Freedom Food” pork versus “Specially SelectedPork”)? (3) Does the demand for animal-friendly and organic pork vary with the level of deprivation ofthe area where consumers are living? The dataset used in the analysis is the Kantar Worldpanel dataset for Scotland, which contains weekly data of food and drink purchases for consumption at home, covering the period 2006-2011. The panel is representative of the Scottish population and covers about 3,694 households. The linear version of the almost ideal demand system was estimated. Then, the own- and the cross-price elasticities as well as the expenditure elasticities for the 22 food categories and products were computed.
The results indicate that when the price of animal-friendly pork increases, consumers decrease their consumption of this product and substitute it by organic pork or regular pork, especially in the case of fresh pork, bacon and sausages. It was found that products with different animal welfare accreditation are substitutes in the eyes of Scottish consumers and are, therefore, competing for the market share of animal-friendly foods. The results also show that the demand for animal-friendly pork is more elastic in the most deprived areas in Scotland.