Department of Agricultural, Food, and Resource Economics Feed the Future Innovation Lab for Food Security Policy

Snyder, J. E., Tschirley, D. L., Reardon, T. A., & Ross, B. R. (2019). A Hedonic Price Analysis of Processed Food Attributes in Tanzania.

Abstract

Numerous authors have shown that shopping in supermarkets and consumption of processed foods both rise with income (Senauer et al., 1986; Gehlhar and Regmi, 2005; Pingali, 2007; Tschirley et al., 2015; Goldman, 1982; Reardon et al., 2003). A longstanding critique of supermarkets in developing countries is that they cater almost exclusively to the middle and upper income classes (Goldman, 1974; Rodríguez et al., 2002; D’Haese et al., 2008; Figuié and Moustier, 2009), selling higher quality items at a higher price. However recent studies in developing countries suggest that while this may be true in the early stages of supermarket penetration, in the longer run supermarkets, especially as they get larger and obtain economies of scale in procurement, can offer equivalent or even lower prices than traditional retail for similar processed food products (Minten and Reardon, 2008), thus appealing to lower income consumers.