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Abstract

Following the case of BSE in Alberta, Canada on May 20, 2003, retail beef sales, domestic disappearance of beef and anecdotal evidence suggests that consumption of beef increased in Alberta. This article investigates fresh meat demand and the impact of BSE on fresh meat demand in Alberta during 2001-2004 through the specification of the linear almost ideal demand system. The model is extended to include a media index of BSE related newspaper articles and an index to capture the temporary loss of Alberta beef export markets. Estimated coefficients and elasticities are consistent with demand theory. The magnitude of own price elasticities are smaller compared to some other Canadian meat studies which may be due to the nature of this data set. The price during the three year period could not demonstrate upward or downward trends as clear as studies which use a much longer data period. The newspaper articles related to BSE had an adverse effect on beef (excluding ground beef) consumption while it generated a positive effect on pork demand. The border closure to beef exports increased the demand for beef. However, it had adverse impacts on pork and chicken demand. In addition, total meat expenditure and demand for beef, pork and chicken show strong seasonality trends.

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