Impacts of generic and brand advertising in the U.S. potato market

The impacts of generic and branded advertising in the U.S. fresh potato, retail frozen potato, and potato chip markets are examined under exogenous and endogenous raw potato supply. The Almost Ideal Demand System is used to estimate the demand components. The general equilibrium elasticities derived from the complete model are used in a simulation analysis to assess the cross-commodity effects of incremental increases in advertising expenditures on equilibrium prices, quantities, revenues, and profits in each sector. The endogeneity of grower supply mitigate the impacts of advertising in the raw commodity sector and in the retail sectors.