The Demand for Organic and Conventional Produce in London, UK: A System Approach

Authors

  • Vasiliki Fourmouzi,

  • Margarita Genius,

  • Peter Midmore

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    • Vasiliki Fourmouzi is a Ph.D. graduate of the Department of Economics, University of Crete, Greece. E-mail: msecon_16@stud.soc.uoc.gr for correspondence. Margarita Genius is an Assistant Professor at the Department of Economics, University of Crete, Greece. Peter Midmore is a Professor at the School of Management and Business, Aberystwyth University. The first author gratefully acknowledges financial support from the Greek General Secretariat of Research and Technology programme Pythagoras I: ‘Management of Natural Resources: Theory and Practice’. The second author gratefully acknowledges the financial support of a Marie Curie Transfer of Knowledge Fellowship of the European Community’s Sixth Framework Programme under contract number MTKD-CT-014288, as well as financial support from a University of Crete research grant. We wish to thank Diansheng Dong, Thanasis Stengos, and the participants of the XIIth Congress of the European Association of Agricultural Economists, where an earlier version of this study was presented, for valuable comments. The helpful suggestions and comments of three anonymous reviewers and the Editor in Chief of this journal are also gratefully acknowledged.


Abstract

The majority of studies on consumer demand for organic products neglect the presence of non-organic competitors, ignoring their effect on consumer demand for organics. This article uses a demand system which includes both organic and non-organic fruits and vegetables, with actual (as opposed to stated) data for household purchases. Estimation of our model provides empirical evidence on the interrelationships between organic and non-organic products, as the relevant cross-price elasticities. Own-price elasticities indicate that organic fruits and vegetables are more price elastic than their non-organic counterparts, and that lower social class households with children have the most own-price elastic demand. Cross-price elasticities indicate relatively strong loyalty to organic products.

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