Abstract
Historically, sugar from beets and sugar cane was the world’s main source of sweetener. As sugar prices increased over time, High Fructose Corn Syrup (HFCS), a corn-based sweetener, became a near substitute for sugar. As a result, the use of HFCS increased and sugar use dropped. However, in the United States, since 2002, the per-capita consumption of HFCS has consistently decreased while per-capita sugar consumption has increased. Conversely, Mexican per-capita HFCS consumption has risen and per-capita sugar consumption has declined. Are the shifts in per-capita consumption of sugar and HFCS due to a change in tastes, a change in the relative prices of sugar and HFCS, or both? Using a log-linear model of Ordinary Least Squares (OLS) analysis we show that the shift in per-capita consumption of sugar and HFCS is significantly influenced by changing relative prices.
