Michael Markarian, president of the Humane Society Legislative Fund, blogs about Measuring the Benefits of Ballot Measures and refers to a peer-reviewed study published in the Journal of Agricultural & Food Industrial Organization. The study, The Effect of Proposition 2 on the Demand for Eggs in California by Jayson L. Lusk, Oklahoma State University, shows how publicity about California’s Proposition 2 in 2008 increased consumer awareness about animal cruelty in industrial egg production, dramatically increased the demand for cage-free eggs and decreased the demand for eggs from caged hens.
Californians recently passed Proposition 2, barring the use of cages in egg production in the state. Because most consumers are unknowledgeable of egg production practices, the appearance of Proposition 2 likely served as an information shock that potentially affected consumer demand. In this paper, we use scanner data to investigate the market effects of Proposition 2 by studying whether and how consumer demand for eggs changed in the months leading up to the vote in San Francisco and Oakland. Results indicate that demand for the types of eggs associated with higher animal welfare standards, cage free and organic, increased over time and in response to articles on the proposition whereas demand for other types of eggs fell. These results coupled with the finding that cage free and organic egg demand was virtually unchanged in a location unaffected by the vote, Dallas, suggests that Proposition 2 had a significant effect on consumer preferences for eggs – increasing demand for cage free and organic eggs by 180% and 20%, respectively.