Consumer awareness of organic products in Spain: An application of multinominal logit models

Organically produced foods have shown remarkable industry growth. Even with strict adherence to the production practices and increasing availability, the majority of consumers are still not aware of organically produced alternatives. Awareness of organics does not necessarily translate into actual consumption. Achieving awareness and understanding the linkage between awareness and purchasing organics is fundamental to impacting the demand for organically grown products. This study focuses on the responses of Spanish consumers regarding their state of knowledge about organic foods products. Consumer demographic characteristics, knowledge of enriched foods, and price perceptions are shown to impact awareness and consumption. Multinomial logit models are used to predict probabilities of awareness. Then probit models are estimated to link awareness and the actual consumption of organic foods. Factors impacting both awareness and consumption are explored using simulation methods and the coefficients from the logit and probit models.