Analyzing Factors Affecting Household Milk Products' Expenditures in Turkey: a Multivariate Heckman Sample Selection System Approach

Abstract

In this study, we analyze the effects of socio-demographic and economic factors of households on the consumption of milk and milk products by considering the recent increased economic trend in Turkey. The multivariate Heckman sample selection system (MSS) is used to analyze the data. The likelihood of spending and levels of expenditure on each foodstuff are jointly analyzed by assuming all pairwise cross correlation. The data used in this study are obtained from Turkish Statistical Institute (TURKSTAT) of 2010 Household Consumption Expenditures Survey (HCES). After discarding missing observations and outliers from the sample, the data finally contain 9442 individual observations. Results indicate that households with younger household heads (20-29 years) as compared households with household heads aged 60 and over are less likely to spend and spend less on milk, yoghurt, cheese with other dairy products in both regions. Families with children 0-5 years old are more likely to spend and spend significantly more on dairy products than that of families with other kids combinations in both regions. Families with annual income 15-30 thousand, 31-45 thousand and 45 thousand and over in Turkish Liras (TL) as compared to the base group (families with annual income 15 thousand TL) spend more 4.5 TL, 9.8 TL and 16.6 TL respectively on cheese and other dairy products in urban area, while these figures are 3.6 TL, 8.0 TL and 9.3 TL for rural households, respectively.