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On the Consumer Value of Diversity: An Application to Italian Fish
Authors:Jean‐Paul Chavas  Michele Baggio
Abstract:This article investigates the consumer value of diversity both conceptually and empirically. It proposes a measure of diversity value based on a benefit function. It shows that the consumer value of diversity can arise from complementarity and/or convexity effects among consumer goods. The usefulness of the approach is illustrated by an application to fish in Italy. The investigation illustrates the role played by both convexity and complementarity in the valuation of diversity. The empirical evidence shows the importance of dynamics. It also documents how the value of diversity varies depending on the bundles considered.
Keywords:Benefit function  complementarity  convexity  diversity  duality  inverse demand  D12  D6  Q22  Q57
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