Willingness-to-Pay for Attribute Level and Variability: The Case of Mexican Millersâ€™ Demand for Hard Red Winter Wheat
AbstractIn-person interviews were carried out with Mexican millers who were administered a conjoint-type survey designed to incorporate uncertainty in attribute levels. Two methods were used to model millersâ€™ risk preferences: a modified mean-variance approach and an explicit expected utility approach. Controlling for variability, Mexican millers are willing to pay premiums for increases in quality factors such as test weight, protein content, falling number, and dough strength/extensibility. We find millers are not particularly sensitive to changes in the variability of quality characteristics. Out-of-sample forecasts suggest the mean-variance model provides an accurate depiction of actual Mexican imports.
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Bibliographic InfoArticle provided by Southern Agricultural Economics Association in its journal Journal of Agricultural and Applied Economics.
Volume (Year): 41 (2009)
Issue (Month): 03 (December)
mean-variance; Mexican wheat market; moment generating function; preference elicitation; wheat quality; Agribusiness; Farm Management; Food Consumption/Nutrition/Food Safety; International Relations/Trade; Marketing; Production Economics; Risk and Uncertainty; C35; C42; Q13;
Find related papers by JEL classification:
- C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
- C42 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Survey Methods
- Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
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