Essays on meat demand in China

This thesis is composed of an essay on meat demand in China and an essay on consumer preferences for imported pork in urban China. The first essay is an application of the Linear Approximate Almost Ideal Demand System (LA/AIDS), which evaluates expenditure elasticities as well as uncompensated (Marshallian) and compensated (Hicksian) demand elasticities for various meats in China. This study uses the latest time series data available on Chinese meat consumption and meat prices. The data indicates a pattern of rising meat consumption in China, especially after the implementation of market based allocation in the early 1990s. Model results show that apart from pork and poultry, most other animal proteins are considered luxuries within the meat budget allocation of the representative Chinese household. Furthermore, the results predict that for any increase in future meat expenditures, the largest share of that increase will be allocated to pork consumption. Implications for both domestic and foreign livestock and feed producers are discussed. The second essay explores factors that influence consumer purchasing decisions regarding imported pork. The data for this study comes from a survey of urban Chinese consumers that was administered in May 2008. An ordered logit model is used to determine which consumer characteristics influence Chinese consumers\u27 willingness-to-pay for U.S. pork. Specifically, this study looks at food safety issues affecting urban consumers, especially acceptance of the lean-meat additive ractopamine (commonly sold in the U.S. as Paylean). A separate model was created to explain Chinese consumers\u27 shopping behavior for western-style pork cuts. Results from this study show that age, shopping location, and food safety concerns, among other factors, have a significant effect on willingness-to-pay for U.S. pork. Food safety was determined to be an important factor in the pork purchasing decision, and urban consumers were reluctant to purchase pork fed with lean meat additives. Regional differences in consumer preferences for imported pork were found across major cities in China