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Consumers' Willingness to Pay for Environmental Attributes of a Cut Flower in Ethiopia: A Choice Experiment Approach

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  • Ahmed Seid Hassen

    (Marmara University Department of Economics, İstanbul, Turkey)

Abstract

The paper aims at valuing consumers' willingness to pay for environmental attributes of a cut flower using choice experiment and hence identifying the presence of a hypothetical market for environmental friendly flowers. Considering the local and global environmental impacts of floriculture, two environmental attributes of a cut flower namely, Eco-labeling (EHPEA-CP label) and Carbone footprint together with a price attribute were selected for choice experiment. Survey data from 200 randomly selected consumers were employed and two multinomial logit models and a random parameter logit model were used for estimations. The estimated results from all models reveled that respondents had the willingness to pay for both environmental attributes of a cut flower and they were willing to pay 1.98 birr and 10 birr for eco-label and carbon footprint attributes of a cut flower respectively, valuing carbon footprint more than eco-labeling. Based on the welfare estimates, consumers were willing to pay 10.47 birr for a bronze labeled and carbon neutral cut flower; 12.45 birr for a flower with silver brand and medium (neutral) carbon footprint and 24.43 birr for brand gold and carbon saving (low) flower. Thus, environmental friendly flowers mayfind a niche market in Ethiopia.

Suggested Citation

  • Ahmed Seid Hassen, 2016. "Consumers' Willingness to Pay for Environmental Attributes of a Cut Flower in Ethiopia: A Choice Experiment Approach," Yildiz Social Science Review, Yildiz Technical University, vol. 2(1), pages 31-46.
    • Handle: RePEc:aye:journl:v:2:y:2016:i:1:p:31-46
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Environmental attributes; choice experiment; willingness to pay (WTP); cut flowerJournal: Yildiz Social Science Review;
    All these keywords.

    JEL classification:

    • F00 - International Economics - - General - - - General
    • F30 - International Economics - - International Finance - - - General
    • G00 - Financial Economics - - General - - - General
    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • K00 - Law and Economics - - General - - - General (including Data Sources and Description)
    • K20 - Law and Economics - - Regulation and Business Law - - - General
    • M00 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - General - - - General
    • M20 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - General
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General

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