Labeling Context and Reference Point Effects in Models of Food Attribute Demand

There is considerable interest in the effect of labels on food product demand. Labeling statements may convey new information about attributes and place consumers in different choice contexts; consumers' assessment of information in labels may be affected by reference points. We examine labeling context relating to genetically modified (GM) food as a factor in the stochastic component of a random utility model and assess reference points over a set of observable characteristics of consumers. We find that labeling context effects are present, although relatively small, while reference dependence is a very important factor that varies over observable characteristics of the sampled consumers.     

Consumption effects of genetic modification: what if consumers are right?⋆

This paper develops a model of differentiated consumers to examine the consumption effects of genetic modification (GM) under alternative labelling regimes and segregation enforcement scenarios. Analytical results show that if consumers perceive GM products as being different than their traditional counterparts, GM affects consumer welfare and, thus, consumption decisions. When the existence of market imperfections in one or more stages of the supply chain prevents the transmission of cost savings associated with the new technology to consumers, GM results in welfare losses for consumers. The analysis shows that the relative welfare ranking of the ‘no labelling’ and ‘mandatory labelling’ regimes depends on: (i) the level of consumer aversion to GM products; (ii) the size of marketing and segregation costs under mandatory labelling; (iii) the share of the GM product in total production; and (iv) the extent to which GM products are incorrectly labelled as non‐GM products.     

Consumer Attitudes to Genetically Modified Food in Norway

There is a lack of public acceptance of genetically modified (GM) food products in Europe. Using a dichotomous choice contingent valuation methodology, we find that, on average, survey respondents with a positive attitude toward the use of biotechnology in food production, higher educated, younger, and male need less of a discount to choose to purchase bread made with GM wheat. Further, we estimate confidence intervals for the mean discount required for consumers to choose GM bread. The 95% confidence interval for the mean discount required for the respondents to choose the GM bread is a 37% to 63% discount relative to conventional bread.     

Mandatory versus voluntary labelling of genetically modified food: evidence from an economic experiment

Opponents of the voluntary labelling scheme for genetically modified (GM) food products often argue that consumers have the “right to know” and therefore advocate mandatory labelling. In this article, we argue against this line of reasoning. Using experimental auctions we show that the quality of the signal generated by a mandatory labelling scheme is affected by the number of labels in the market. If there are two labels, one for GM products and one for non‐GM products, mandatory and voluntary labelling schemes generate a similar degree of uncertainty about the quality of products that do not carry a label.     

Least-cost cheap-food policies: some implications of international food aid

Many low-income countries pursue cheap-food policies in which consumers pay subsidized prices for bread, rice and other staples. This paper addresses the issue of why different governments select different food subsidy policies, using multiple instruments rather than a simple across-the-board subsidy to provide consumers with access to cheap food. It examines the optimal structure of cheap-food policies in the context of a partial equilibrium model in which the country may he large in trade, and is able to combine import subsidies or tariffs, and output taxes or subsidies, to transfer income to consumers through the market. The model allows for a marginal opportunity cost of government revenues greater than one dollar. In addition, in the model, food aid from overseas may be either given away to the consumer, or given to the government for subsequent sale in the domestic market. The results indicate that only by happenstance will a country choose to use a pure consumption subsidy or a pure import subsidy to transfer income to consumers. In addition, an increase in international food aid does not necessarily lead the government to reduce producer and consumer prices for a commodity.     

Consumers’ Response to Genetically Modified Ingredients in Processed Food in an Emerging Economy

Genetically modified (GM) foods are available in many countries including post–Soviet Union countries. However, empirical evidence on consumer acceptance for this region is scarce. In this study, we investigate consumers’ willingness to purchase a processed food containing GM ingredients. For this purpose, a consumer survey was conducted in 2015 in Tajikistan. In many aspects, our results confirm previous empirical findings showing that women are more skeptical toward GM food and a higher level of respondents’ education and the presence of minors in households are negatively correlated with their willingness to purchase a processed food containing GM ingredients. Moreover, a higher risk perception of GM food is negatively associated with the probability to purchase and consume such foods. However, our results indicate that risk perceptions of GM food seem to be relatively low in comparison to other studies with 41.5% of Tajik respondents connecting no risks with GM food. This result is surprising given the existing knowledge about post–Soviet Union consumers who are usually assumed to reject GM food due to their strong focus on naturalness.     

Consumer preferences for GM food and other attributes of the food system

While qualitative surveys regarding consumers' attitudes about gene technologies and their application to food production are plentiful, quantitative studies are less so. The present paper reports choice modelling methods to examine the conditions under which Australian consumers are willing to purchase genetically modified (GM) foods, if at all, and examines those preferences within the context of the food system as a whole. This allows us to compare consumer attitudes towards gene technology to consumer preferences for other features of the food they consume. The results of the choice modelling analysis suggest consumers require a discount on their weekly food bill before they will purchase GM food. Gene technology using animal as well as plant genes was found to be more objectionable to respondents than that using plant genes alone, especially among women. Age seems to affect the preferences for a certain type of food, with older people generally more accepting of the use of gene technology.     

Traceability in the Canadian Red Meat Sector: Do Consumers Care?

Increased traceability of food and food ingredients through the agri-food chain has featured in recent industry initiatives in the Canadian livestock sector and is an important facet of the new Canadian Agricultural Policy Framework (APF). While traceability is usually implicitly associated with ensuring food safety and delivering quality assurances, there has been very little economic analysis of the functions of traceability systems and the value that consumers place on traceability assurances. This paper examines the economic incentives for implementing traceability systems in the meat and livestock sector. Experimental auctions are used to assess the willingness to pay of Canadian consumers for a traceability assurance, a food safety assurance, and an on-farm production method assurance for beef and pork products. Results from these laboratory market experiments provide insights into the relative value for Canadian consumers of traceability and quality assurances. Traceability, in the absence of quality verification, is of limited value to individual consumers. Bundling traceability with quality assurances has the potential to deliver more value.     

On the Segregation of Genetically Modified,Conventional and Organic Products in European Agriculture: A Multi‐market Equilibrium Analysis

Evaluating the possible benefits of the introduction of genetically modified (GM) crops must address the issue of consumer resistance as well as the complex regulation that has ensued. In the European Union (EU), this regulation envisions the co‐existence of GM food with conventional and quality‐enhanced products, mandates the labelling and traceability of GM products and allows only a stringent adventitious presence of GM content in other products. All these elements are brought together within a partial equilibrium model of the EU agricultural food sector. The model comprises conventional, GM and organic food. Demand is modelled in a novel fashion, whereby organic and conventional products are treated as horizontally differentiated but GM products are vertically differentiated (weakly inferior) relative to conventional ones. Supply accounts explicitly for the land constraint at the sector level and for the need for additional resources to produce organic food. Model calibration and simulation allow insights into the qualitative and quantitative effects of the large‐scale introduction of GM products in the EU market. We find that the introduction of GM food reduces overall EU welfare, mostly because of the associated need for costly segregation of non‐GM products, but the producers of quality‐enhanced products actually benefit.     

A cost-benefit analysis of a public labelling scheme of fish quality

The purpose of this paper is to introduce a new method capable of evaluating the economic welfare for quality graded fish products using the hedonic price method for plaice in Denmark. Today, no labelling scheme exists for the final consumers of different qualities of fish. A scheme only exists at the first hand market. On this basis, a general applicable, theoretical and empirical method is developed to compare the costs and benefits of the hypothetical choice between the total absence of labelling and the presence of a public labelling scheme, which fully informs consumers on the quality and simultaneously allows the producers to differentiate prices between quality grades. It is shown that the economic welfare associated with a public labelling scheme is at minimum €263,000. Sensitivity analysis shows that this result is robust. The policy implication is that a public labelling scheme should not be implemented as the demand and cost functions have low elasticities, implying that the welfare gain is low.     

Consumers’ Preferences for Bread: Transgenic,Cisgenic, Organic or Pesticide‐free?

Consumers are apprehensive about transgenic technologies, so cisgenics, which limit gene transfers to sexually compatible organisms, have been suggested to address consumer concerns. We study consumer preferences for rye bread alternatives based on transgenic or cisgenic rye, grown conventionally or without the use of pesticides, relative to traditionally bred rye, grown with conventional or organic farming methods. Stated preference (SP) data from a choice experiment are combined with revealed preference (RP) data from market purchases from the same respondents. Results show that respondents prefer pesticide‐free production methods, and that while cisgenics is preferred over transgenics, the majority of respondents favour traditional breeding methods. The distribution in preferences suggests that some respondents prefer bread from cisgenic crops produced without pesticides over traditional crops produced using pesticides. Preferences for organic bread are stronger than for pesticide‐free products. From a policy perspective results suggest that excluding cisgenics from mandatory labeling in the EU, or including it in the voluntary non‐GM labelling in the US, would cause welfare losses for consumers.     

Consumer demand for nutrition versus taste in four major food categories

This study addresses the trade‐off between nutrition and taste in expenditure on breakfast cereal, milk, bread, and soft drinks. Within each category, products have similar cost and convenience, but have markedly different flavor and nutritional content. Using annual expenditure data for a large sample of households participating in the ACNielsen Homescan system, we regress a measure of “healthiness” on household demographics and market prices, and find that households with college‐educated heads and higher incomes made significantly healthier choices in all four categories. These effects are puzzling in that the nutritional differences between products were well known to consumers, and there are no cost or convenience differences between them. The presence of children was associated with less healthy choices, especially for cereal and bread, while older households made healthier choices in all categories except milk.     

Strategic response to GMOs by GM-free countries

This article examines the dilemma of a large exporting countryof an agricultural product that has to determine whether ornot to approve genetically modified (GM) products with or withouta labelling regime. We derive two main results. First, the approvaldecision on GM products is specific to the labelling regime:approval of GM products is optimal under a labelling regime,whereas non-approval is optimal in the absence of a mandatorylabelling requirement. Second, the inability to protect theinnovator's rent through IPR enforcement can prevent the approvalof GM products.     

消费者对安全认证农产品自述偏好与现实选择的一致性及其影响因素——以生鲜认证猪肉为例

以生鲜认证猪肉产品为例,本文利用对北京市城镇消费者的问卷调查数据,实证分析了消费者对安全认证农产品自述偏好与现实选择的一致性及其影响因素。结果显示,尽管50%以上的消费者对生鲜认证猪肉有自述偏好,其食品质量安全意识较强,但是,消费者对生鲜认证猪肉自述偏好与现实选择之间存在着较大的差异。消费者受教育程度、消费者家庭月收入、家中是否有18岁以下的孩子和家庭人口规模等是影响其对生鲜认证猪肉自述偏好与现实选择一致性的个人特征和家庭特征因素。消费者对生鲜认证猪肉的意愿支付价格、消费者对质量安全认证知识和认证农产品的了解程度显著正向影响其对生鲜认证猪肉自述偏好与现实选择的一致性。此外,消费者的食品质量安全意识和其所感知到的生鲜猪肉产品的质量安全隐患等变量也会较显著地影响其对生鲜认证猪肉自述偏好与现实选择的一致性。     

A Conjoint/Logit Analysis of Consumers’ Responses to Genetically Modified Tofu in Taiwan

We use data collected from a consumer survey of face‐to‐face interviews to determine consumer demand for genetically modified (GM) tofu attributes in Taiwan. Conjoint analysis using logit models reveals that, on average, brand is the most important attribute in terms of influence on consumers’ preferences, followed by price, with GM content having the least influence. However, the analysis also reveals three distinct market segments for tofu. Apart from the largest segment (which reflects the average lack of concern about GM food), the remaining two segments are split according to their preference or antipathy towards GM tofu. This result suggests that GM labelling is helpful to Taiwanese tofu consumers.     

Integrating Factors Influencing Consumers’ Halal Products Purchase: Application of Theory of Reasoned Action

ABSTRACT

The purpose of this research is to determine Muslim consumers’ purchase perceptions of Halal products in Pakistan. The research team has integrated different factors such as processing, Halal logo, ingredients, health consciousness, perceived value, food safety concern, and religious factor with Theory of Reasoned Action (TRA), and they investigated their influence on consumers’ attitudes and intentions to purchase Halal food products. A survey was conducted in Islamabad and Rawalpindi city, Pakistan. A total of 282 (56.4%) completed questionnaires were received from 500 respondents. Structural equation modeling technique was used to determine consumers’ purchase intention and behavior regarding Halal products. Except for health consciousness and Halal logo, all factors positively influence consumers’ attitude and purchase intention of Halal food products and, subsequently, their purchase behavior.     

Economic Effects of the Consumer‐oriented Genetically Modified Products in Markets with a Labelling Regime

This paper builds on the literature on the economic effects of the second‐generation, consumer‐oriented genetically modified products (GMPs). It analyses the market and welfare impacts of the introduction of these new products in markets, like the EU, that mandate the segregation and labelling of the first‐generation, producer‐oriented GMPs. Developing an empirically relevant model of heterogeneous consumers and producers, the study determines the effects of the consumer‐oriented GMPs on the markets of conventional, GM and organic products, and the welfare of consumers and agricultural producers. Analytical results indicate that the market effects of the new GMPs are case specific and depend on: (i) the consumer valuation of the quality‐enhancing attribute of the new GMP; (ii) the level of consumer aversion to GMOs; (iii) the strength of consumer preference for organic products; and (iv) the production costs and marketing margins in the different supply channels. The policy on the labelling of the first‐generation GMPs does not affect the impacts of the second‐generation GMPs on the quantities and market shares of the different products. However, it does affect their price effects and welfare implications. The introduction of consumer‐oriented GMPs under a mandatory labelling regime can result in losses for some GM consumers and all producers of the conventional product.     

Hedonic Analysis of Consumers' Valuation of Country of Origin of Meat in the United Kingdom

We estimate the implicit prices consumers are willing to pay for country of origin labels, using hedonic price methods and panel data for meat and meat products in the United Kingdom. Our results show that consumers place significant value on origin information across fresh and processed meat products, especially since the horsemeat incident in 2013. The findings also suggest that retailers have increased the use of voluntary labelling of processed meat products since the incident. Hence, further extension of existing mandatory labelling requirements to processed meat products may not be required at least in the short term.     

Policies and Attitudes toward Genetically Modified foods in Norway

Policies and Attitudes toward Genetically Modified Foods in Norway Norwegian food and agricultural policies have up to now prevented the introduction and commercialization of GM foods. This may be considered just an imitation of EU neighbours. On the other hand, based on results from our study, the application of the precautionary principle to GM foods is well justified in Norway since consumers currently do not feel comfortable with these products. Our analysis is based on data from a survey of 400 food shoppers in the Oslo‐region of Norway conducted in January 2002. Of consumers surveyed, eighty‐six per cent of consumers thought labeling of GM foods was very important. Consumers in the sample were on average only willing to purchase GM bread with an approximately 50 per cent discount compared to non‐GM bread, indicating that there is strong scepticism toward GM foods in Norway. When comparing the consumers who were the most willing to purchase GM bread with the consumers who were the least willing to purchase GM bread, we found that the latter group was significantly older, had more women, higher incomes and lower formal education. The strict Norwegian GM food policies are consistent with the consumer consensus against the inclusion of GM foods in the Norwegian market. Les aliments génétiquement modifiés en Norvège:politiques mises en oeuvre et attitudes des consommateurs Jusqu'ici, les politiques agrtcoles et alimentaires en Norvège ont toujours prohibé l' importation et la commercialisation d'aliments génétiquement modifyés. On pourrait l' interpréter comme une simple imitation de ce qui se passe dans l' UE voisine. Pourtant, les résultats présentés ici montrent que l'application du principe de précaution aux aliments génétiquement modifyés est justifyée en Norvège par le fait que les consommateurs ne se sentent pas confortables avec ces produits. Ceci ressort d'une enquête effectuée en Janvier 2002 auprès de 400 acheteurs de produits alimentaires dans la règion d'Oslo. 86% des répondants estiment que l'étiquetage des produits génétiquement modifyés est ‘très important’. En moyenne, les consommateurs de l'échantillon exigent un baisse de 50% du prix du ‘pain OGM’ par rapport au pain ‘non OGM’ pour accepter d'acheter le premier. Cela témoigne d'un fort scepticisme vis‐à‐vis des OGM en Norvège. Quand on oppose le groupe des consommateurs les ‘plus favorables’ aux OGM au groupe des ‘moins favorables’ on trouve que le second est composé de gens plus vieux, qu'il est plus féminin, bénéficie de revenus plus élevés et d'un niveau d'éducation plus faible. La politique anti‐OGM suivie en Norvége est done en accord avec l'opinion publique, qui rejette l'idée d'introduire ces produits sur les marchés norvégiens. Politikmaßnahmen und Einstellungen zu genetisch veränderten Le bensmitteln in Norwegen Die norwegische Agrar‐ und Ernährungspolitik hat bislang die Einführung und Vermarktung von genetisch veränderten Lebensmittein erfolgreich verhindert. Dies könnte lediglich als Nachahmung der EU‐Nachbarn aufgefasst werden. Unseren Forschungsergebnissen zu Folge wird das Sicherheitsprinzip auf genetisch veränderte Lebensmittel in Norwegen jedoch aus gutem Grund angewendet, da die Verbraucher diesen Produkten zur Zeit nicht genug Vertrauen entgegen bringen. Unsere Analyse gründet sich auf Umfragedaten von 400 Lebensmittelkäufern aus der Region um Oslo/Norwegen imjanuar2002. 86 Prozent der Befragten hielten es fur sehr wichtig, genetisch veranderte Lebensmittel zu kennzeichnen. Die Verbraucher in dieser Stichprobe waren im Durchschnitt nur dann bereit, genetisch verändertes Brot zu kaufen, wenn es im Vergleich zu genetisch nicht verandertem Brot einen Preisnachlass von zirka 50 Prozent gäbe. Darin zeigt sich eine starke Skepsis der Norweger gegenüber genetisch veränderten Lebensmittein. Beim Vergleich der Verbraucher, weiche die starkste Bereitschaft zeigten, genetisch verändertes Brot zu kaufen, mit den Verbrauchern, weiche die schwächste Bereitschaft zeigten, genetisch verändertes Brot zu kaufen, ergab sich, dass die zweite Gruppe ein signifikant höheres Alter, einen höheren Frauenanteil, höhere Einkommen und eine geringere Schulbildung aufwies. Die strikten norwegischen Politikmaßnahmen im Hinblick auf genetisch veränderte Lebensmittel entsprechen dem Wunsch der Verbraucher, genetisch veränderte Lebensmittel auf dem norwegischen Markt nicht zuzulassen.     

Do Nutrition Claims Matter to Consumers? An Empirical Analysis Considering European Requirements

EU Regulation 1924/2006 introduced a European legal framework for nutrition messages for food product labels. The study analyses consumer interest towards nutrition labelling and claims, and examines the information consumers consider important during their purchasing decisions, and the main characteristics of those consumers interested in nutrition claims and nutrition labelling use. A total of 1,025 northern Italian consumers were surveyed. We estimate one binary logit model to investigate the use of nutrition labelling, and seven other ordinal regression models to analyse consumer interest towards nutrition claims and labelling. Consumers who use nutrition labelling have characteristics different from those who use nutrition claims. Consumers using nutrition labelling show a marked interest in food safety concerns, use experts as their source of information and have specific dietary habits. For consumers concerned about nutrition claims, the survey shows significant links with attributes influencing purchasing behaviour, such as price, brand, certification, etc. Socio‐demographic characteristics are statistically significant and show a positive link with age, gender and a negative linkage with income.