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Abstract

The organic market sector is one of the fastest growing food sectors in the United States with growth rates in organic food sales averaging 17 percent per year between 1998 and 2006. The largest segment within the organic market is fresh produce, comprising 34 percent of retail sales in 2006. To date, few published studies utilize consumer purchase information to understand which demographic factors influence the purchase of organic produce. This analysis focuses on household produce purchases in 2006 from the Nielsen Homescan Dataset. Assuming that household produce purchases are made in a two step process, a Heckman two-stage model is utilized to examine the factors that influence the probability a consumer will buy organic produce, and which factors influence the household share of organic produce purchased. Results show households with high levels of education and income are more likely to purchase organic pre-packaged produce, while the probability of purchasing organic fruits and vegetables decreases amongst African Americans.

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