The Demand for Disaggregated Food-Away-from-Home and Food-at-Home Products in the United States

Abstract

Food away from home (FAFH) comprises nearly half of all U.S. consumer food expenditures. Hence, policies designed to influence nutritional outcomes would be incomplete if they did not address the role of FAFH. However, because of data limitations, most studies of the response of food demand to policy changes have ignored the role of FAFH, and those studies that have included FAFH have treated it as a single good. We, therefore, estimate demand for 43 disaggregated FAFH and food-at-home (FAH) products, using a 2-stage budgeting framework. We find that the demands for disaggregated FAFH products differ in price responsiveness and tend to be more sensitive to changes in food spending patterns than FAH products. Many foods are found to have statistically significant substitution and complementary relationships within and among food groups. Predicted changes in quantities based on our estimates that include all goods and services and those estimates that include only a subset of foods differ substantially, implying that evaluations of health and nutrition policy based on elasticities of demand for only a subset of goods may be misleading.