Household inventory behavior: An empirical investigation of grocery purchases

Theoretical studies have recently drawn attention to the significance of non-durable commodity holdings by households. The present paper is an effort to find empirical evidence that household inventory behavior has definable properties. A large set of grocery purchase data, the Chicago Tribune Consumer Panel, is investigated. On the basis of the analysis it is suggested that grocery shopping behavior broadly conforms to that anticipated by inventory theory and that the rate of discount applied on these holdings varies negatively with income across households.