This study examines the demand for healthy and nutritious foods in Detroit, Michigan, which is considered a food desert with limited access to such foods. The researcher will analyze retail scanner data from Peaches & Greens, a produce store in Detroit, over a one-year period to determine how sensitive consumer demand is to price changes for fresh fruits and vegetables. The goal is to understand consumer behavior and provide recommendations to businesses operating in food deserts. Preliminary results show little price variation for produce at Peaches & Greens, making it difficult to assess price elasticity of demand through regression analysis. More data will need to be collected over time to study how prices may influence demand.

1. Research Question:​
Determining Price Affect on Demand For Fresh Fruits and
Vegetables in Detroit Michigan
Introduction
This issue of food deserts is a prevailing problem that is spreading across the United
States. A food deserts describes an area where inhabitants have little or no access to
healthy and nutritional foods. A city that fits the description of a food desert is the
city of Detroit, Michigan. The city of Detroit has around a population of 871,000
people (Census 2006) and was once one the richest cities in the nation due to the
presences of the “big three” automotive firms, Ford, General Motors and Chrysler.
Since, due to white and black flight and job loss, the population of the city has been
on a steady decline and the city has also seen grocery stores leave the area, which
has created a food desert. “Detroit residents- has to travel twice as far to reach a
quality grocery store versus a fast food chain or convenience store” (Gallagher 5).
This study focuses on the demand for healthy and nutritional foods in a food desert
area. A Demand Analysis will be conducted on retail-level scanner data from
Peaches & Greens, a fresh produce store that serves the Piety Hill Community of
Detroit, for a complete fiscal year. With this data, this study seeks to show changes
in demand for healthy and nutritious foods, particularly fresh fruits and vegetables
(F&V).
Objective
With limited knowledge about price sensitivity of demand for healthy and
nutritional foods in Detroit, the issue of food deserts will never be solved. The

2. overall goal of this study is to find out how sensitive people living in a food desert
setting are to price changes for healthy and nutritional foods. This information will
be used to make recommendations to businesses that currently operate in these
settings and business that want to enter these markets to better understand the
behavior of the consumer base. This information will allow businesses to develop
models to meet the needs of this consumer base.
Background
The motivation behind this study is to figure out what causes individuals to not
consume Healthy and Nutritional Foods in Food Desert Areas by looking at factors
such as the own price elasticity of demand for specific items.
Methods
I will be doing a Demand Analysis that look at Consumer Demand in previous
readings the best way to solve the objectives of the research is by using some basic
Demand Theory specifically an AIDS Model which stands for An Almost Ideal
Demand System AIDS model gives an arbitrary first-order approximation to any
demand system; it satisfies the axioms of choice exactly (The Economic View 312).
The Data consist of Retail Level Scanner Data that shows the Time; Date; Number of
Items bought; Payment Method: Credit (EBT), Cash, Check; What Items where
bought. From January 2009- December 2009. With this information the Model I
would be using is a Regression Analysis to predict the elasticity’s of Demand for
Fresh Fruits and Vegetables

3. Results
Figure 1 shows the total sales and amount sold for each fruit from May 2009 –
April 2010

4. .
Figure 2 shows the price per grapes for each month from May 2009- April
2010
Figure 3 shows the Quantity of grapes bought each month from May 2009-
April 2010
After attempting linear regression analysis for grapes we find that the analysis was
unsuccessful due to the lack of variance in price change for the produce items. We
did find that grapes have no seasonality and purchase frequently throughout the 12

5. month period and the price for all produce sold by Peaches & Greens remained
consistent throughout the year.
Future work will entail collecting more retail-level data from Peaches & Greens to
see if the retailer has made a change in their pricing behavior, over time, to
determine the price affects on demand for fresh fruits and vegetables.
Conclusion
Peaches & Greens, a young fresh fruit and vegetable retailer, are doing an excellent
job in understanding the customers they serve. They have consistent prices, which
benefit both the retailer and the consumer. Other business should see Peaches &
Greens as an example of understanding their demographics.