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Coupon Redemption and Its Effect on Household Cheese Purchases
Author(s) -
Dong Diansheng,
Kaiser Harry M.
Publication year - 2005
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.1111/j.1467-8276.2005.00756.x
Subject(s) - coupon , quality (philosophy) , unit (ring theory) , business , value (mathematics) , economics , econometrics , demographic economics , agricultural economics , statistics , mathematics , philosophy , mathematics education , finance , epistemology
By endogenizing unit value and coupon redemption, we estimate U.S. household cheese purchase, quality choice, and coupon redemption equations simultaneously. Zero purchases and missing values on coupons and unit values are taken into account in the model to correct for selectivity bias. Correlations among the three equations are found to be significant. Empirical findings show that high‐quality choice significantly decreases cheese purchases, while cheese coupon usage significantly increases purchases. We find that higher income households select higher quality cheese, while larger households choose lower quality cheese. For coupon redemption, we find that African‐American and Hispanic households redeem less, while Asian households have no significant difference compared to Caucasian households.