DEMOGRAPHIC TRENDS AND CONSUMER DEMAND
FOR AGRICULTURAL PRODUCTS
P a t r i c i a Knight Guseman
and
Stephen G. Sapp
Department of R u r a l S o c i o l o g y ,
Texas A&M U n i v e r s i t y
ABSTRACT
Food c o n s u m p t i o n p a t t e r n s a f f e c t e d by m a c r o - l e v e l p o p u l a t i o n
c h a r a c t e r i s t i c s are examined w i t h r e s p e c t t o p r o j e c t e d demographic
trends. S t a n d a r d demand models based on p r i c e and income a r e enhanced t o
r e f l e c t i m p a c t s of t o t a l p o p u l a t i o n , h o u s e h o l d s i z e , and r e g i o n a l
p o p u l a t i o n d i s t r i b u t i o n . These models p r o v i d e b a s e l i n e i n f o r m a t i o n f o r
i l l u s t r a t i n g e f f e c t s on food demand under d i f f e r e n t social-demographic
s c e n a r i o s , s u c h as c h a n g e s i n p o p u l a t i o n s i z e , r e g i o n a l m i g r a t i o n
p a t t e r n s , and changes i n household s i z e , composition, and income growth,
rates.
L i k e l y d e m o g r a p h i c p r o j e c t i o n s show a g r e a t e r p r o p o r t i o n a l
e f f e c t of t o t a l p o p u l a t i o n , household s i z e , and r e g i o n a l s h i f t s on food
demand t h a n income f o r some commodities and f o r t o t a l food demand. Food
c o n s u m p t i o n d a t a a r e b a s e d o n t h e USDA N a t i o n w i d e Food C o n s u m p t i o n
Survey, 1977-78.
I n a g r i c u l t u r a l r e s e a r c h , s c i e n t i s t s from numerous f i e l d s s e e k t o
improve p r o d u c t i v i t y and t o p r o v i d e r e s u l t s t h a t w i l l b o o s t consumption
of
agricultural
population.
products.
This
s t u d y f o c u s e s on
the
consuming
Changes i n t h e s i z e , composition, and d i s t r i b u t i o n of t h e
A m e r i c a n p o p u l a t i o n are h a v i n g s i g n i f i c a n t e f f e c t s on f a r m p r o d u c t
sales.
The e v o l v i n g form and s t r u c t u r e of t h e p o p u l a t i o n can be viewed
t h r o u g h e x a m i n a t i o n o f (1)
decelerating t o t a l domestic population
g r o w t h , (2) d e c l i n i n g h o u s e h o l d s i z e , (3) a l t e r a t i o n s i n r e a l i n c o m e ,
and (4) r e g i o n a l r e d i s t r i b u t i o n of t h e population.
p o p u l a t i o n domain a r e n o t o n l y having s h o r t - t e r m ,
v i s i b l e i m p a c t s on t h e
consumption of s p e c i f i c a g r i c u l t u r a l products,
e v o l u t i o n a r y t r e n d s whose long-term
These s h i f t s i n t h e
but also represent
e f f e c t s on a g r i c u l t u r a l p r o d u c t i o n
should be considered.
A g r i c u l t u r a l e c o n o m i s t s t r a d i t i o n a l l y have explored supply-demand
r e l a t i o n s h i p s a s s o c i a t e d w i t h t h e consumption of food, u t i l i z i n g p r i c e
and income a s t h e p r i n c i p a l c o n d i t i o n i n g o r e x p l a n a t o r y dimensions.
At
t h e p r e s e n t t i m e , t h r e e f a c t o r s a r e f o s t e r i n g t h e u s e of demographic
i n d i c a t o r s i n e x p l a i n i n g t h e changing s t r u c t u r e of a g r i c u l t u r a l demand:
(1)
Demographic e s t i m a t e s and p r o j e c t i o n s f o r a v a r i e t y of
s t r u c t u r a l and c o m p o s i t i o n a l c h a r a c t e r i s t i c s are now
a v a i l a b l e on an annualized b a s i s ;
(2)
P r o j e c t i o n s of demographic c h a r a c t e r i s t i c s may be more
r e l i a b l e and less obscure t h a n f o r e c a s t s of c u r r e n t l y
v o l a t i l e e c o n o m i c i n d i c a t o r s s u c h as r e a l m e d i a n
income o r product p r i c e ; and
(3)
The demand f o r f o o d a n d f i b e r i s l e s s s e n s i t i v e t o
economic c o n d i t i o n s t h a n a r e o t h e r major household
p u r c h a s e s , as a g r i c u l t u r a l c o m m o d i t i e s f u l f i l l
sustenance n e e d s .
THEORETICAL BOUNDARIES
A b r o a d m o d e l o f human a c t i o n i s r e q u i r e d t o f o c u s on consumer
demand--one
a t a s u f f i c i e n t l y high l e v e l of g e n e r a l i t y t o be a p p l i c a b l e
i n a l l s c i e n c e s w h i c h f o c u s on human b e h a v i o r .
have long i n t e r e s t e d s o c i o l o g i s t s ,
56).
Consumptive p a t t e r n s
a s w e l l a s economists (Sobel, 1981:
This s o c i o l o g i c a l i n t e r e s t can be t r a c e d t o LePlay's concern w i t h
t h e e f f e c t s of s t a n d a r d s of l i v i n g i n 1 9 t h Century Europe.
H i s studies
o f c o n s u m p t i o n r e v e a l e d t h e i n h e r e n t l i n k s among f a m i l i a l s t r u c t u r e ,
s o c i a l o r g a n i z a t i o n , a n d t h e v a l u e s y s t e m , a l l of w h i c h i n f l u e n c e d
consumption patterns.
On t h e b a s i s of
h i s observations,
LePlay
f o r m u l a t e d a r u d i m e n t a r y t h e o r y o f s o c i a l s t r u c t u r e (Timasheff, 1967:
48).
Zimmerman (1929) a n d Loomis (1934),
advancing LePlay's
work,
showed t h a t t y p e s of i n v e s t m e n t s v a r y w i t h s o c i a l s t r u c t u r a l
characteristics.
More r e c e n t l y , P a r s o n s '
(1955) i n t e g r a t i v e a p p r o a c h d e f i n e d a
g e n e r a l s y s t e m o f human b e h a v i o r .
H i s view of t h e s o c i a l system
d i s t i n g u i s h e d s o c i o l o g i c a l v a r i a b l e s from t h o s e used i n t h e o t h e r s o c i a l
s c i e n c e s ( s u c h as e c o n o m i c s , p s y c h o l o g y , and b i o l o g y ) , a s w e l l a s
p i n p o i n t e d s o c i o l o g i c a l r e l a t i o n s h i p s w i t h n o n s o c i a l dimensions.
Sapp and Guseman (1983) have d e s c r i b e d food consumption through t h e
u s e of
Parsons'
AGIL m o d e l ,
where t h e g e n e r a l s y s t e m of
action
r e p r e s e n t s t h e f i r s t l e v e l o f a n a l y s i s , f o l l o w e d by a n a p p l i c a t i o n t o
t h e s o c i a l system and t h e i n d i v i d u a l a s t h e second and t h i r d l e v e l s of
a b s t r a c t i o n , r e s p e c t i v e l y ( F i g u r e 1).
Food demand, t h r o u g h t h e AGIL
model, can be observed a s a n i n t e r d i s c i p l i n a r y dimension, r e f l e c t i n g
b i o l o g i c a l , s o c i o c u l t u r a l , and p s y c h o l o g i c a l needs f o r s u s t e n a n c e w i t h i n
t h e l i m i t s of one's a b i l i t y t o s a t i s f y t h e s e needs.
are not s t r i c t l y biological;
D e s i r e s f o r food
i f t h i s dimension were t h e s o l e p r e d i c t o r
of i n t a k e , c o n s u m e r s c o u l d s u b s i s t on d o g m e a t o r s e a w e e d - - s u b s t a n c e s
c o n s i d e r e d u n d e s i r a b l e by most s t a n d a r d s .
A s Sapp a n d Guseman (1983) and R o c h e r (1975: 60) h a v e e x p l i c a t e d
t h e AGIL model, t h e key p r e d i c t o r s of food i n t a k e a r e r e p r e s e n t e d by t h e
f o u r c e l l s r e p r e s e n t i n g s o c i e t y ' s subsystems.
These c e l l s are then
g i v e n concepts, each w i t h concomitant c o n c r e t e r e f e r e n t s :
t h e economy,
p o l i t y , s o c i e t a l community, and s o c i a l i z a t i o n .
The e m p i r i c a l
controlling
factors
referents i n these four
(Parsons,
d i f f e r e n t i a t i o n a t t h e macromacro-level
1966:
28),
and micro-levels.
o r d e m o g r a p h i c d i m e n s i o n s of
cells
a r e viewed
representing
as
lifestyle
T h i s paper u t i l i z e s t h e
t h e P a r s o n i a n model t o
FIGURE 1.
E x p l a n a t o r y R e f e r e n t s of Food Demand
ADAPTATION
GOAL AlTAINKENT
Economy
I
Polity
PATTERN MAINTENANCE
I
Culture
A.
INTERGRATION
Society
I
F i r s t Level of Abstraction:
The General T h e o r y
of A c t i o n and concomitant Sub-Systems o f S o c i e t y
ECONOMY
Median Income
( P r i c e of Products)
POLITP
Total Population
(Commodity Programs)
SOCIETAL COKMLRIITY
Region
( D i s t r i b u t i o n o f Food)
B.
Household S i z e
(Production/Xarketing
of Food)
Second Level o f A b s t r a c t i o n :
Macro-Level
I n f l u e n c e s on Food Consumption
Societal
Referents
of
Food Demand
I
Demographic
Indicators
------------Social
Indicators
BEHAVIORAL
ORGANISM
Age
Sex
CULTURE
Socioeconomic S t a t u s
Race
C.
PERSONALITY
Tastes
Preferences
SOCIETY
Participation i n
Labor F o r c e
RuralIUrban Residence
Third Level of Abstraction:
Micro-Level
I n f l u e n c e s on Food Consumption
Individual
Referents
of
Food Demand
d e m o n s t r a t e t h a t median income,
t o t a l population,
household s i z e ,
and
r e g i o n a l p o p u l a t i o n d i s t r i b u t i o n s a r e u s e f u l i n e x p l a i n i n g food demand.1
F u r t h e r , t h e paper s e e k s t o v e r i f y t h a t economic i n d i c a t o r s , such a s
p r i c e and income, i f used i n i s o l a t i o n from o t h e r r e f e r e n t s , cannot
p r o v i d e a n a c c u r a t e o r complete a s s e s s m e n t of food consumption.
METHODOLOGY
I n i t s s i m p l e s t form, t h e demand f o r any one commodity o r commodity
b u n d l e h a s been measured a s a f u n c t i o n of q u a n t i t y and p r i c e .
I n an
e m p i r i c a l s e n s e , t h e demand f o r a g r i c u l t u r a l commodities was measured i n
t h i s s t u d y through consumption, w i t h t h e assumption of f i x e d p r i c e s .
Consumption p e r c a p i t a and f o r households was based on t h e most r e c e n t
USDA N a t i o n w i d e Food C o n s u m p t i o n S u r v e y (NFCS) undertaken i n 1977-78.
I n two i n s t a n c e s ,
c o m p a r i s o n s a r e made w i t h a c o m p a r a b l e s u r v e y
undertaken i n 1965-66.
The 1977-78 NFCS was based on a s t r a t i f i e d a r e a
p r o b a b i l i t y sample o f t h e 48 coterminous s t a t e s d u r i n g t h e f o u r q u a r t e r s
f r o m A p r i l , 1977 t o March, 1 9 7 8 , a n d c o n t a i n s c o n s u m p t i o n d a t a f o r
a p p r o x i m a t e l y 700,000 i t e m s f o r 1 5 , 0 0 0 h o u s e h o l d s , n a t i o n w i d e ,
with
i n d i v i d u a l d a t a f o r 34,000 r e s p o n d e n t s . F o r t h i s p a p e r , t h e d a t a on a
p e r household o r p e r c a p i t a b a s i s i s a g g r e g a t e d t o n a t i o n a l household o r
p o p u l a t i o n t o t a l s f o r p r o j e c t i o n purposes.
P r o j e c t i o n s of t o t a l p o p u l a t i o n , household s i z e , household money
income, and r e g i o n a l p o p u l a t i o n were o b t a i n e d from r e c e n t U.S.
Bureau
of t h e Census p r o j e c t i o n s e r i e s ( r e f e r t o t a b l e r e f e r e n c e s ) .
' ~ e d i a n h o u s e h o l d i n c o m e and h o u s e h o l d s i z e were i n c l u d e d a s
macro-level i n d i c a t o r s ; both v a r i a b l e s a r e viewed a s being
s t r u c t u r a l l y d e t e r m i n e d and b o t h a r e t r e a t e d i n t h e a g g r e g a t e , i.e.,
a t t h e s o c i e t a l l e v e l ( M c I n t o s h a n d Guseman, 1983).
P r o c e d u r e s f o r t h e p r o j e c t i o n s a r e e x p l a i n e d i n p u b l i s h e d form by t h e
Bureau of t h e Census ( s e e r e f e r e n c e s ) .
I n a l l cases,
maximum and
minimum p r o j e c t i o n s from e a c h s e r i e s were u t i l i z e d f o r t h e following
demographic r e f e r e n t s :
(1)
Changes i n
dimension;
total
population,
representing
the "polity"
(2)
Changes i n h o u s e h o l d s i z e ,
community" component;
(3)
A l t e r a t i o n s i n h o u s e h o l d income g r o w t h r e p r e s e n t i n g t h e
"economy" dimension; and
(4)
Changes i n l o c a t i o n of t h e population r e g i o n a l l y ,
t h e " c u l t u r a l " component.
consistent with the "societal
reflecting
The c o n f i g u r a t i o n of e m p i r i c a l r e f e r e n t s was a r b i t r a r y , based on a broad
overview of t h e Parsonian model and Rocher's (1975: 61-70)
discussion of
t h e s t r u c t u r a l components of each of t h e f o u r c e l l s i n t h e AGIL model.
CHANGING TOTAL POPULATION AND FOOD DEMAND
During t h e h i g h g r o w t h p e r i o d o f t h e 1 9 5 0 s , t h e m a r k e t s f o r f o o d
and f i b e r expanded i n proportion t o population growth.
decades,
For t h e l a s t two
a d o m i n a t i n g f o r c e i n t h e c o u n t r y ' s e v o l v i n g demographic
p r o f i l e h a s b e e n t h e d e c e l e r a t i o n o f p o p u l a t i o n growth.
D e sp i t e an
i n c r e a s i n g a b s o l u t e population, annualized growth r a t e s have declined by
75 percent s i n c e 1950.
The d e c l i n i n g t o t a l f e r t i l i t y r a t e h a s been t h e p r i m a r y f o r c e
behind t h e drop i n population growth r a t e s , r a t h e r than n e t immigration.
While n e t c i v i l i a n immigration remained around 400,000 annually f o r t h e
1970 d e c a d e , n e t n a t u r a l i n c r e a s e dropped f r o m 1.8 m i l l i o n i n 1970 t o
s l i g h t l y over 1.2 m i l l i o n i n 1980.
D o m e s t i c p o p u l a t i o n ( T a b l e 1) shows a c o n t i n u e d d e c e l e r a t i o n of
TABLE 1.
P r o j e c t e d T o t a l U.S.
Total:
Low
Series
Percent
Change
Population
Total:
Middle
Series
Percent:
Change
Total:
High
Series
Percent
Change
aActual population count
b ~ h es e r i e s a s s u m e a 1.6 t o 2.3 r a n g e o f u l t i m a t e l i f e - t i m e b i r t h s p e r
woman, a l i f e e x p e c t a n c y by 2 0 5 0 r a n g i n g f r o m 76.7 t o 8 3 . 3 , a n d a n
a n n u a l i z e d n e t i m m i g r a t i o n f r o n 250,000 t o 750,000 o v e r t h e p r o j e c t i o n
periods.
Source:
" P r o j e c t i o n s of t h e P o p u l a t i o n of t h e U n i t e d S t a t e s , " C u r r e n t
W a s h i n g t o n , D.C.:
U.S.
P o p u l a t i o n R e p o r t s , S e r i e s P-25,
No. 9 2 2 .
Government P r i n t i n g O f f i c e .
g r o w t h f o r t h r e e s e r i e s o f p r o j e c t i o n s t h r o u g h t h e y e a r 2000.
These
s e r i e s p o i n t t o a r a n g e of 12.9 t o 24.6 p e r c e n t i n c r e a s e i n t o t a l
population f o r t h e 1980-2000 period.
Mid-series
p r o j e c t i o n s of growth
prepared by t h e Bureau of t h e Census i n d i c a t e t h a t a f t e r t h e year 2050,
population w i l l begin t o decline.
Zero p o p u l a t i o n g r o w t h c o u l d have
been a r e a l i t y i n 1980, based on t h e under-replacement f e r t i l i t y r a t e of
1.83,
were i t not f o r t h e b i r t h s by women from t h e baby boom generation
and a p o s i t i v e n e t immigration.
Because o f d e c e l e r a t i n g g r o w t h r a t e s , some p o l i c y a n a l y s t s and
planners have shown concern about economic s t a g n a t i o n and d e c l i n e caused
by population s t a t i o n a r i t y .
Espenshade (1981: 23) argues, however, t h a t
h i g h e r per c a p i t a d i s p o s a b l e income w i l l p r o v i d e a compensating
dimension, s o t h a t t h e l e v e l of expenditures w i l l remain s i m i l a r t o t h e
past.
Further, Espenshade suggests t h a t t h e p r o p o r t i o n of expenditures
a c r o s s major economic s e c t o r s w i l l n o t a l t e r appreciably.
Musgrove (1982:
26-29)
r e c e n t l y d e v e l o p e d a model f o r f u t u r e
consumer s p e n d i n g i n t h e U n i t e d S t a t e s u s i n g 12 m a j o r e x p e n d i t u r e
c a t e g o r i e s ( s e e T a b l e 2).
H e a n a l y z e d f u t u r e consumer p u r c h a s e s f o r
s p e c i f i c goods and s e r v i c e s and i s o l a t e d t h e r e l a t i v e p r o p o r t i o n o f
expenditure growth a t t r i b u t a b l e t o p r o j e c t e d changes i n (a) population
s i z e , (b) population composition ( t r e a t e d a s an aggregate v a r i a b l e ) , and
(c) disposable income.
Based on t h i s c o m p r e h e n s i v e a s s e s s m e n t a c r o s s
expenditure. categories,
a g r e a t e r p r o p o r t i o n of
the increase i n
consumption was explained by r i s e s i n d i s p o s a b l e income than by changes
i n t o t a l p o p u l a t i o n o r p o p u l a t i o n c o m p o s i t i o n (Musgrove, 1982: 28).
However, food and c l o t h i n g remained r e l a t i v e l y unaffected by income and,
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u o r ~ r s o d i u o ~ a aa % e ~ u a s l a d - z 3
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along with
transportation requirements,
were
shown t o b e more
s u s c e p t i b l e t o p r o j e c t e d c h a n g e s i n p o p u l a t i o n t h a n i n income.
Food,
f u l f i l l i n g a s u s t e n a n c e need, w a s more a f f e c t e d by t h e population s c a l e
parameter than any o t h e r e x p e n d i t u r e category.
Further,
indications
even w i t h i n c r e a s e d p e r c a p i t a income,
there are
of a d e c l i n e i n t h e p r o p o r t i o n of consumer e x p e n d i t u r e s f o r
basic necessities--food
and c l o t h i n g - - w i t h
a g r e a t e r s h a r e of i n c o m e
expended f o r consumer d u r a b l e s and s e r v i c e s (Musgrove, 1982: 26; Ridker,
1978: 127-155).
Musgrove p r o j e c t s a d e c l i n e i n food e x p e n d i t u r e s under
b o t h z e r o income growth and income growth assumptions.
I n sum, p o p u l a t i o n p r o j e c t i o n s suggest a d e c e l e r a t i o n i n t h e demand
f o r food, w h i l e m u l t i v a r i a t e models of f u t u r e p o p u l a t i o n and income show
a r e d u c t i o n i n t h e s h a r e o f d i s p o s a b l e i n c o m e u t i l i z e d f o r f o o d and
These t r e n d s w i l l have a d i r e c t e f f e c t on t h e s t r u c t u r e
f i b e r products.
of demand f o r a g r i c u l t u r a l products.
FOOD DEMAND AND CHANGING HOUSEHOLD SIZE AND COMPOSITION
Absolute p o p u l a t i o n t o t a l s p r o v i d e a n a g g r e g a t e d p i c t u r e o f f o o d
demand, b u t p a r t i a l l i n g of component e f f e c t s i s necessary t o a d d r e s s t h e
i m p l i c a t i o n s of demographic change f o r t h e a g r i c u l t u r a l market basket.
Household c o n f i g u r a t i o n s a f f e c t f o o d e x p e n d i t u r e s , w i t h o b s e r v a b l e
economies of scale (based on household s i z e ) and d i f f e r e n t p r o p o r t i o n s
of v a r i o u s commodities consumed (based on household composition).
Household s i z e h a s d e c l i n e d s u b s t a n t i a l l y e a c h d e c a d e t h r o u g h o u t
t h i s century.
2.76
The number of persons p e r household i n 1950 was 3.37
i n 1980,
a d e c l i n e of
18,percent.
The
and
household-size
t r a n s f o r m a t i o n has been a composite of many elements, i n c l u d i n g housing
a v a i l a b i l i t y , income growth, t h e f e r t i l i t y r a t e , and i n c r e a s i n g numbers
living alone.
A s household s i z e d e c l i n e s , g r e a t e r expenditures p e r c a p i t a a r e
observed.
A n a l y s i s of t h e NFCS d a t a shows t h a t p e r c a p i t a e x p e n d i t u r e s
i n one-person
households.
h o u s e h o l d s a r e 1.6
Thus,
t i m e s higher than i n six-person
t h e d e c l i n e i n household s i z e should r e s u l t i n
g r e a t e r e x p e n d i t u r e s on a p e r c a p i t a b a s i s .
S a l a t h e (1979:
1041-42)
showed t h a t d e c l i n i n g h o u s e h o l d s i z e
r e s u l t e d i n i n c r e a s e d p e r c a p i t a i n t a k e f o r most food p r o d u c t s ,
e s p e c i a l l y cheese, b e e f , f i s h , and f r u i t s - - f o o d s
that are typically
p r e f e r r e d s u p e r i o r g o o d s O 2 P r o j e c t i o n s o f h o u s e h o l d s i z e show t h e
e f f e c t s o n f o o d i n t a k e f o r s e l e c t e d meat p r o d u c t s ( T a b l e 3 ) , i.e.,
i n c r e a s e d p e r c a p i t a consumption of meat.
an
Using an e l a s t i c i t y measure
of household s i z e , t h e e f f e c t s of a one-percent
d e c l i n e i n average
p e r s o n s p e r h o u s e h o l d c a n be a s s e s s e d , c o n t r o l l i n g f o r p r i c e .
This
approach t h u s tests w h e t h e r t h e p e r c a p i t a and household demand f o r meat
i s s e n s i t i v e t o changes i n household size.3
E l a s t i c i t y , using the
s h r i n k a g e r a t i o , i s d e f i n e d as:
'A s u p e r i o r good h a s a p o s i t i v e income e l a s t i c i t y f o r a l l income
l e v e l s , w h i l e a p r e f e r r e d s u p e r i o r good e v i d e n c e s h i g h e r e l a s t i c i t i e s
w i t h h i g h e r income l e v e l s .
3 ~ o u s e h o l ds i z e e l a s t i c i t i e s , a s w e l l a s income e l a s t i c i t i e s , a r e
d i f f i c u l t t o e s t i m a t e a c c u r a t e l y . However, w i t h income e l a s t i c i t i e s a
s t a n d a r d m o n e t a r y u n i t c a n be u s e d , b u t t h e a d d i t i o n o r l o s s o f o n e
person p e r household does not r e p r e s e n t a "standard" person, u n l e s s
a d u l t e q u i v a l e n t s c a l e s are used.
TABLE 3
I
.
E l a s t i c i t i e s o f Household S i z e f o r P e r C a p i t a and Household Meat
Consumptiona
Consumption by P e r i o d ( g r a m s l d a i l y )
1990:
Projected
Series I
1990 :
Projected
S e r i e s I1
Consumptive
Uni t
1965
1977
Per Capita
Consumpti on
293.3
319.1
326.8
337.9
Household
Consumption
965.1
865.6
840.1
804.4
a ~ lmle a t s i n c l u d e r e d m e a t s , p o u l t r y a n d f i s h .
Elastic i t i e s of
Household
Size
-.50
where q = q u a n t i t y consumed a t t i m e s 1 a n d 2 (i.e.,
1977; 1977 and 1990; 1977 and 1995)
h = h o u s e h o l d s i z e a t t i m e s 1 a n d 2 (i.e.,
1977; 1977 and 1990; and 1977 and 1995)
A s might be a n t i c i p a t e d ,
1 9 6 5 and
1 9 6 5 and
household consumption declined w i t h
r e d u c t i o n s i n t h e number of p e r s o n s p e r d w e l l i n g u n i t .
Using an
e l a s t i c i t y measurement f o r household s i z e , a l a r g e i n v e r s e r e l a t i o n s h i p
was observed w i t h p e r c a p i t a q u a n t i t i e s of meat consumed; meat i n t a k e
p e r person rises w i t h d e c l i n i n g household s i z e .
Most s i g n i f i c a n t l y ,
e l a s t i c i t i e s f o r h o u s e h o l d s i z e a r e l a r g e r on a p e r c a p i t a b a s i s t h a n
a r e i n c o m e e l a s t i c i t i e s ( s e e G e o r g e a n d K i n g , 1971: 70; S a l a t h e and
Buse,
1970:
lo).
Thus,
household s i z e i s a c r i t i c a l population
p a r a m e t e r t h a t s h o u l d b e i n c o r p o r a t e d i n f u r t h e r a n a l y s e s of consumer
demand.
INCOME CHANGES
AM) FOOD DEMAND
I n t h e P a r s o n i a n framework, t h e s u c c e s s f u l economic f u n c t i o n i n g of
a s o c i e t y i s d e p e n d e n t on i t s a d a p t i v e c a p a c i t i e s .
The p r o c e s s e s o f
d i s t r i b u t i o n of income t o h o u s e h o l d s and i n d i v i d u a l s a r e c o n c e n t r a t e d
w i t h i n t h e economic sub-system.
A g r i c u l t u r a l e c o n o m i s t s ( F a r r i s , 1982; G e o r g e and K i n g ,
--
H a i d a c h e r , e t al.,
1982:
85)
197 1;
have emphasized t h e s t r o n g p r e d i c t i v e
v a l u e o f income i n e x p l a i n i n g t h e v a r i a t i o n i n q u a n t i t y of s p e c i f i c
a g r i c u l t u r a l p r o d u c t s consumed.
F u r t h e r , as household income i n c r e a s e d ,
p r o p o r t i o n a t e l y less was expended f o r food p r o d u c t s (Huang and Raunikar,
1981:
39).
H i s t o r i c a l l y , r e a l household incomes have i n c r e a s e d , w h i l e
s l i g h t d e c l i n e s i n t h e p r o p o r t i o n s p e n t on food have been observed.
However, r e a l h o u s e h o l d i n c o m e d e c l i n e d b e t w e e n t h r e e t o f i v e
p e r c e n t a n n u a l l y s i n c e 1979 b e c a u s e of r e d u c e d h o u s e h o l d s i z e and
e c o n o m i c c o n d i t i o n s ( B u r e a u of
t h e Census,
3).
1982:
Several
demographic f a c t o r s a r e l i k e l y t o have s i g n i f i c a n t e f f e c t s on t h e l e v e l
and growth of household income i n t h e 1980s.
The r e d u c t i o n i n persons
p e r h o u s e h o l d a n d , t h e r e f o r e , i n wage e a r n e r s , w i l l e f f e c t t h e money
income of i n d i v i d u a l households.
Second, a l t e r a t i o n s i n h o u s e h o l d
composition, such a s t h e i n c r e a s e i n female-headed households and o t h e r
non- t r a d i t i o n a l household f o r m a t i o n s , w i l l have a dampening e f f e c t on
t h e o v e r a l l g r o w t h r a t e of h o u s e h o l d income.
On t h e o t h e r h a n d ,
i n c r e a s e d l a b o r f o r c e p a r t i c i p a t i o n by women s h o u l d c o n t i n u e t o
f a v o r a b l y i n c r e a s e median incomes.
Finally,
t h e changing age
d i s t r i b u t i o n of t h e p o p u l a t i o n , w i t h a 40 p e r c e n t i n c r e a s e i n t h e number
of persons 35 t o 44 y e a r s o l d , w i l l i n c r e a s e t h e e a r n i n g s p o t e n t i a l of
the population.
O v e r a l l , t h e r e a r e "push" and " p u l l " f a c t o r s a f f e c t i n g h o u s e h o l d
income.
Compositional e f f e c t s p o i n t t o g r e a t e r e a r n i n g s p o t e n t i a l f o r
those i n the labor
population employed.
f o r c e and a g r e a t e r p r o p o r t i o n of
the t o t a l
On t h e o t h e r hand, d e c l i n i n g household s i z e and a n
u n s t a b l e economy should have g r e a t e r i m p a c t s on r e a l median household
income, s o t h a t a c o n t i n u e d d e c l i n e a p p e a r s f e a s i b l e .
The r a n g e of
a l t e r n a t i v e household money incomes growth r a t e s p r o j e c t e d by t h e Bureau
of t h e Census i s p r e s e n t e d i n Table 4.
Income h a s t y p i c a l l y been used a s t h e prime independent v a r i a b l e a t
t h e i n d i v i d u a l o r household l e v e l t o e x p l a i n food demand ( S a l a t h e , 1979:
TABLE 4 .
Household Consuzption
projectionsa
Year (and
hocsehold S i z e )
of
Meat
Tio I n c o m e
Growth (znnual)
icggregace
Consumption
( a 11 houseLousehold
holds i n
Consuzprion thcnsand
(lbs.)
lbs.)
Under
X l t e r n z t i v e Len!og:aphic-Eccnomic
.@A i n c o m e
- 0 2 Income
Grc.dth ( ~ n n c a l )
Growth ( . z ~ ) ? , ~ a l )
h.ggrcgat e
Af;zegate
Cons~apcion
Cons.:z?tion
( a l l house(a11 h o u s e Fiousehold
holds i n
Hocsehold
holds in
Consumption
cnousana
Ccnsumption thonsand
(Ibs.)
lbs.)
(Ihs.)
lbs.)
1985
2.65
(I)
2.53
(111)
1990
2.58
(I)
2.39
(111)
1995
2.54
(I)
2.26
(111)
a ~ o l d i n gp e r c a p t i a c o n s u m p t i o n l e v e l s c o n s t a n t a t 1 9 7 7 l e v e l s .
b ~ e r i e s1 r e f l e c t s a g r o v i n g p o p u l a t i o n
p o p u l a t i o n g r o w t h t o z e r o i n 2020.
and S e r i e s
11-1 p o r t r a y s
a
slowing of
Computed f r o m d a t a i n :
Bureau of t h e C e n s u s . I l l u s t r a t i v e P r o j e c t i o n s o f Honey
1 9 8 0 t o 1 9 9 5 , S e r i e s P - 6 0 , No. 1 2 2 ( U a r c h ,
Income S i z e D i s t r i b u t i o n s , f o r Households:
1 9 8 0 ) ; B u r e a u o f t h e C e n s u s , P o p u l a t i o n E s t i m a t e s a n d P r o j e c t i o n s , S e r i e s P - 2 5 , No. 8 3 5
(May. 1 9 7 9 ) ; a n d U.S.
D e p a r t m e n t o f A g r i c u l t u r e , Economic R e s e a r c h S e r v i c e , Food
C o n s u m p t i o n . P r i c e s a n d E x p e n d i t u r e s , A g r i c u l t u r a l E c o n o m i c R e p o r t No. 1 3 6 , 1 9 7 7
Suppleotent (Sepr-ercber, 1 9 7 9 ) .
22), w i t h o t h e r s o c i o d e m o g r a p h i c v a r i a b l e s , s u c h a s h o u s e h o l d s i z e ,
r a c e , s e x and age, t r e a t e d a s c o n d i t i o n i n g f a c t o r s .
e f f e c t s of
Very o f t e n t h e
o t h e r v a r i a b l e s are " c o n c e a l e d " w i t h i n t h i s b i v a r i a t e
approach t o examining consumption.
Thus, when h o u s e h o l d i n c o m e and
household consumption a r e c o r r e l a t e d , income may a c t u a l l y have "hidden"
mu1t i c o l l i n e a r e f f e c t s w i t h household s i z e ,
household composition (sex
of household head and age of a d u l t household members), e d u c a t i o n a l l e v e l
of t h e purchaser, and a wide v a r i e t y of o t h e r sociodemographic f a c t o r s .
I n sum, t h e u s e of income and p r i c e as key p r e d i c t o r s of food demand may
mask o t h e r e q u a l l y e x p l a n a t o r y v a r i a b l e s h e r e t o f o r e n o t r i g o r o u s l y
examined.
T a b l e 4 shows a m u l t i v a r i a t e a n a l y s i s of f u t u r e meat consumption,
using t h e maximum range of p r o j e c t i o n s of household income,
s i z e , and t o t a l domestic population.
a t 1 9 7 7 l e v e l s ( b a s e d on NFCS d a t a ) .
household
P e r c a p t i a meat i n t a k e was f i x e d
Meats, i n c l u d i n g r e d meats,
p o u l t r y , and f i s h , are defined b r o a d l y as p r e f e r r e d s u p e r i o r goods and,
t h u s , a s s e n s i t i v e t o c h a n g e s i n income.
However, when c o m p a r i n g
changes i n income t o changes i n household s i z e , t h e l a t t e r v a r i a b l e
a p p e a r s t o h a v e a g r e a t e r e f f e c t on t h e demand f o r b e e f ( s e e T a b l e 4).
The i m p a c t s o f t h r e e a n n u a l h o u s e h o l d i n c o m e g r o w t h r a t e s and two
household s i z e p r o j e c t i o n s a r e shown i n Table 4, w i t h p r o j e c t e d income
r e f e r e n c e d i n 1977 r e a l d o l l a r s f o r 0.0,
income growth rates.4
2.0,
and 4.0 p e r c e n t a n n u a l
The c h a n g e i n m e a t demand f o r h o u s e h o l d s i s
calculated:
4 ~ h eBureau h a s n o t p r e p a r e d p r o j e c t i o n s of h o u s e h o l d money
income which show annual d e c l i n e s based on r e a l d o l l a r s .
Where D
=
demand f o r meat a t t i m e s 1 and 2
E
=
income e l a s t i c i t y of .0225
I
=
income, w i t h A1 d e n o t i n g t h e change from 1 t o time 2
H
=
household s i z e
I n the short t e r m ,
changes i n income and household s i z e have
e q u i v a l e n t e f f e c t s o n a g g r e g a t e meat demand.
By 1 9 9 5 , h o w e v e r , t h e
e f f e c t s o f h o u s e h o l d s i z e a n d t o t a l p o p u l a t i o n show a 7 b i l l i o n pound
a g g r e g a t e consumption d i f f e r e n t i a l f o r t h e two series ( I and 111) a c r o s s
a l l t h r e e income scenarios.
Within household p r o j e c t i o n S e r i e s I o r
111, i n c o m e c h a n g e s a f f e c t a g g r e g a t e demand by l e s s t h a n 2 b i l l i o n
pounds annually.
While t h i s example i s i l l u s t r a t i v e , i t d e m o n s t r a t e s
t h a t , u n d e r s0m.e c o n d i t i o n s , t h e a g g r e g a t e demand f o r m e a t and o t h e r
a g r i c u l t u r a l commodities depends more on p o p u l a t i o n s i z e and household
s i z e t h a n on changes i n income.
REGIONAL POPULATION REDISTRIBUTION AND FOOD DEMAND
The g e o g r a p h i c d i s t r i b u t i o n of
f o o d and f i b e r p r o d u c t i o n i s
s u b s t a n t i a l l y d i f f e r e n t f r o m t h e c o n c e n t r a t i o n of p o p u l a t i o n .
R e s i d e n t i a l movement,
e s p e c i a l l y t o Southern and Western r e g i o n s , h a s
b e e n s u b s t a n t i a l s i n c e 1970.
B e t w e e n 1970 a n d 1980 t h e number of
persons m i g r a t i n g t o Southern s t a t e s was 8.3 m i l l i o n .
N e t migration t o
t h e South a l o n e r e p r e s e n t e d o v e r two m i l l i o n more p e r s o n s t h a n t h e
combined n e t m i g r a t i o n i n t h e remainder of t h e United S t a t e s .
U.S.D.A.
5 ~ r o s s - s e c t i o n a l e l a s t i c i t y f o r t o t a l meat, c o m p u t e d f r o m t h e
Nationwide Food Consumption Survey, S p r i n g , 1977 data.
S i n c e 1970, p o p u l a t i o n i n t h e S o u t h h a s been i n c r e a s i n g a t an
a c c e l e r a t e d r a t e , w h i l e t h e n a t i o n ' s g r o w t h r a t e h a s been d e c l i n i n g .
The e f f e c t s of t h e s e opposing growth curves on t h e demand f o r food and
f i b e r c a n b e examined t h r o u g h a n a l y s i s of
p r o j e c t e d t o 2000.
p e r c a p i t a consumption
While i n t a k e i s r e d u c e d f o r many a g e c o h o r t s
n a t i o n a l l y , an i n c r e a s e a c r o s s cohorts i s p r o j e c t e d f o r t h e South.
A s s h a r e s of t h e n a t i o n a l population a r e r e - d i s t r i b. .u t e d ,
t h e movers
w i l l have pronounced i m p a c t s on t h e s p a t i a l a l l o c a t i o n s o f consumer
expenditures.
Additionally, t h e l o c a t i o n a l c o n f i g u r a t i o n of processing,
t r a n s p o r t a t i o n , and o t h e r a u x i l l a r y a g r i c u l t u r a l marketing s e r v i c e s w i l l
be a l t e r e d by t h e s e m i g r a t i o n p a t t e r n s .
I t h a s been s u g g e s t e d t h a t p o p u l a t i o n s h i f t s s h o u l d l e s s e n t h e
r e g i o n a l v a r i a t i o n i n food consumption, s o t h a t region of r e s i d e n c e w i l l
become l e s s s a l i e n t a s a c u l t u r a l determinant of food consumption (Burk,
1961).
F u r t h e r , a c l o s u r e i n t h e i n c o m e g a p b e t w e e n S o u t h e r n and a l l
other s t a t e s should bring
greater uniformity i n
a g r i c u l t u r a l products (Ecklund, 1969).
t h e demand f o r
Comparisons of p r o p o r t i o n s of
per c a p i t a i n t a k e f o r s p e c i f i c food products a c r o s s regions a r e provided
i n T a b l e 5 f o r 1965 and 1 9 7 7 , b a s e d on NFCS d a t a .
q u a n t i t i e s of products consumed,
regional p r i c e d i f f e r e n c e s ,
Interestingly,
c o n t r o l l i n g f o r changes i n p r i c e and
had not become more homogeneous by region.
Levels of consumption v a r i e d more r e g i o n a l l y i n 1977 r e l a t i v e t o 1965
f o r d a i r y p r o d u c t s , p o u l t r y and p o r k , as w e l l a s v e g e t a b l e s and f r u i t .
R e g i o n a l v a r i a t i o n had l e s s e n e d f o r f o u r of
t h e n i n e major food
c a t e g o r i e s , i n c l u d i n g beef and f i s h and some p r o c e s s e d f o o d s , s u c h as
c e r e a l s , baked goods and f a t s and o i l s .
TABLE 5.
The Mean, Range, S t a n d a r d D e v i a t i o n , and C o e f f i c e n t o f V a r i a t i o n f o r Household ConsumptionE x p e n d i t u r e R e l a t i o n s h i p s f o r Foods f o r 1965-66 and 1977-78 Across Regions 2
1977-78
1965-66
Food
Product
cereals1
Bakery I t e m s
Mean
Range
Standard
Deviation
Coeff l c i e n t
of V a r i a t i o n
Mean
Range
Standard
Deviation
Coefficient
of V a r i a t i o n
P e r c e n t Change
i n Coefficient
of V a r i a t i o n :
1977-1965
131.5
29.1
13 .O
9.9
82.6
17 .5
7 .4
9 .O
Fresh F r u i t
35.9
18.9
8.5
23.6
35.9
22.5
9 .9
27.6
16.9
Fresh
Vegetables
33.3
13.5
5.5
16.6
31.4
17.1
7.2
23.1
38.8
3.7
1.7
20.5
4.9
1.5
0.7
14.5
-29.5
F a t s and
Oils
8 -3
-9.5
Beef
70.7
25.5
12 .O
17 .O
64.2
7 .3
4.1
6 .4
-62 .5
Pork
26.2
12.8
6.7
25.6
19.3
14.3
6.5
33.8
32.1
Poultry
9.6
3 .O
1.4
14.2
9.6
6.3
2.9
30 .6
116.2
Fish
2.8
2.6
1.4
40.3
3.5
2.1
1.2
32.2
-20.1
156.4
18.1
8.2
252.0
66.1
28.3
11.2
113.2
Dairy
Products
5-3
p
w
2 ~ h emeans, r a n g e s , s t a n d a r d d e v i a t i o n s , and c o e f f i c i e n t s of v a r i a t i o n w e r e o b t a i n e d a c r o s s t h e f o u r m a j o r
U.S. r e g i o n s by d i v i d i n g q u a n t i t y consumed ( m e a s u r e d i n g r a m s p e r day f o r t h e S p r i n g ) f o r e a c h food by t o t a l food
i n t a k e and m u l t i p l y i n g by t h e e x p e n d i t u r e s p e r food p r o d u c t r e l a t i v e t o t o t a l f o o d e x p e n d i t u r e s , i.e.,
(Q~/Q~)
( E ~ / E ~(1000).
>
Using b r o a d food c a t e g o r i e s ,
i t a p p e a r s t h a t a g r e a t d e a l of
d i v e r s i t y remains i n r e g i o n a l consumption p a t t e r n s .
D i f f e r e n c e s by
r e g i o n e x i s t a f t e r c o n t r o l l i n g . f o r r e l a t i v e p r i c e s f o r each region.
Thus, t h e d i v e r s i t y w h i c h r e m a i n s i n c o n s u m p t i o n p a t t e r n s by r e g i o n
appears t o be based more on v a r i a t i o n i n preferences and t a s t e s , r a t h e r
than d i f f e r e n t i a l a v a i l a b i l i t y of s p e c i f i c a g r i c u l t u r a l products.
CONCLUSIONS AND IMPLICATIONS FOR FUTURE RESEARCH
L i f e s t y l e and, therefore, consumption a r e determined by micro-level
f a c t o r s a s w e l l a s macro-level
c h a r a c t e r i s t i c s a t t h e s o c i e t a l level.
These l a t t e r c h a r a c t e r i s t i c s , i n c l u d i n g income g r o w t h r a t e s , c h a n g i n g
household s i z e , regional population r e - d i s t r i b u t i o n ,
and changes i n t h e
t o t a l p o p u l a t i o n , have been shown t o a f f e c t p e r c a p i t a and a g g r e g a t e
u t i l i z a t i o n of
a g r i c u l t u r a l commodities.
Further,
t h e changing
s t r u c t u r e of demand f o r a g r i c u l t u r a l products can be explained, i n l a r g e
p a r t , by demographic i n d i c a t o r s .
I n previous research, income has received a g r e a t d e a l of a t t e n t i o n
as t h e prime nonmarket dimension explaining t h e demand f o r a g r i c u l t u r a l
commodities.
expensive,
Rising consumer income r e s u l t s i n a s u b s t i t u t i o n of more
a n i m a l p r o t e i n f o o d s f o r s t a p l e s and,
p r o p o r t i o n a t e l y l e s s being spent on food.
typically,
in
Nevertheless, changing income
must be viewed as one of a complex s e t of s o c i e t a l and i n d i v i d u a l
a t t r i b u t e s which i n t e r a c t t o e s t a b l i s h t h e markets f o r farm products.
T h i s r e s e a r c h h a s f o c u s e d on (1) a n e x p l i c a t i o n of d e m o g r a p h i c
t r e n d s e x p l a i n i n g f o o d and f i b e r demands and ( 2 ) t h e i n t e r d e p e n d e n t
n a t u r e of
economic and
demographic v a r i a b l e s .
In
agricultural
economics, u t i l i t y maximization theory t r e a t s demographic v a r i a b l e s a s
exogeneous.
The P a r s o n i a n AGIL m o d e l i n c l u d e s b o t h s o c i a l s t r u c t u r a l
v a r i a b l e s a n d a c c o m o d a t e s e c o n o m i c d i m e n s i o n s as w e l l .
Thus, w i t h
p r i c e s h e l d c o n s t a n t , t h e s o c i o l o g i c a l t h e o r y subsumes t h e economic
perspective.
I n c a s e s where t h e p r i m a r y concern r e v o l v e s around e x a m i n a t i o n of
t h e c h a n g i n g s t r u c t u r e o f demand f o r a g r i c u l t u r a l p r o d u c t s ,
it is
p o s s i b l e t o draw upon p r i o r economic work and develop a more i n c i s i v e
and complete model of consumption.
T h i s e f f o r t can b e undertaken e i t h e r
through f u r t h e r demographic a n a l y s e s o r through m o n i t o r i n g consumption
data
at
the individual
level,
c h a r a c t e r i s t i c s a s primary predictors.
using
personal
o r background
Such r e s e a r c h e f f o r t s can extend
s o c i o l o g i c a l t h e o r i e s of l i f e s t y l e d i f f e r e n t i a t i o n and s o c i a l s t r u c t u r e .
I m p l i c a t i o n s f o r a g r i c u l t u r a l p r o d u c t i o n and m a r k e t i n g a l s o should
be considered.
T h i s paper h a s emphasized b a s i c demographic t r e n d s which
are anticipated
t o h a v e a p r o n o u n c e d i m p a c t on t h e m a r k e t s f o r
a g r i c u l t u r a l commodities.
Such t r e n d s w i l l a f f e c t farm p r o d u c t s a l e s i n
t h e f o l l o w i n g ways:
(1)
A l t e r i n g f o o d a n d f i b e r demand i n t h e a g g r e g a t e and by
commodities;
(2)
A f f e c t i n g t h e amount and p r o p o r t i o n of consumer income s p e n t
on a g r i c u l t u r a l p r o d u c t s ; and
(3)
Changing t h e a l l o c a t i o n of a v a i l a b l e s u p p l i e s ; p r e d i c t a b l e
p o p u l a t i o n p a t t e r n s w i l l d e t e r m i n e , t o some e x t e n t w h e t h e r
t h e r e w i l l be s u r p l u s e s o r s h o r t a g e s of s p e c i f i c products.
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