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A structural time series approach to modelling multiple and resurgent meat scares in Italy

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This paper exploits a structural time series approach to model the time pattern of multiple and resurgent food scares and their direct and cross-product impacts on consumer response. A structural time series Almost Ideal Demand System (STS-AIDS) is embedded in a vector error correction framework to allow for dynamic effects (VEC-STS-AIDS). Italian aggregate household data on meat demand is used to assess the time-varying impact of a resurgent BSE crisis (1996 and 2000) and the 1999 Dioxin crisis. The VEC-STS-AIDS model monitors the short-run impacts and performs satisfactorily in terms of residuals diagnostics, overcoming the major problems encountered by the customary vector error correction approach.

Document Type: Research Article


Affiliations: 1: Department of Statistics, University of Bologna, Italy 2: Department of Agricultural and Food Economics, University of Reading, UK

Publication date: August 10, 2006

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