Impact of European egg marking system in France: empirical time series analysis between 2017 and 2022

Abstract

AbstractVoluntary labeling strategies, such as Organic label or Label Rouge, have long been considered as a potential solution to address environmental and social issues in the food sector. As a complement, the European political authorities developed a mandatory marking system for fresh eggs. This article questions the effectiveness of public intervention to support sustainable practices using analysis of the demand for fresh eggs in France. Unit root (augmented Dickey Fuller) tests, stationarity (KPSS) tests, and Seasonal Autoregressive Integrated Moving Average (SARIMA) models are used to investigate the unit root behavior of the prices and expenditure shares of fresh eggs in France between 2017 and 2022. We use the Almost Ideal Demand System model on scanner data to analyze the demand of six eggs’ categories, including mandatory egg codes and two labels (Organic and Label Rouge). The results suggest that a low price does not compensate for low sustainability involvement in eggs from caged farming, favoring free range eggs. Label Rouge shows market weaknesses, while the organic label shows promising results with both a voluntary and a specific mandatory mark. The lack of elasticity observed, except between cage and free range eggs, implies that consumers who choose high-priced products with voluntary labeling strategies are less inclined to switch to alternatives. The mandatory marking system brings more transparency than voluntary labeling initiative, in favor of sustainable products. The case of eggs is a relevant example of how market intervention can push sustainable consumption and production without forbidding products in the market.