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Economic Benefits Coming from the Absence of Labels Proliferation

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  • Marette Stéphan

    (Department of Economics, INRA, UMR Economie Publique, Grignon 78850, France)

Abstract

In a lab experiment, two milk bottles with different levels of omega-3 were offered to participants for eliciting willingness to pay. We find that a simple message on the difference regarding the omega-3 content between bottles significantly impacts the participants’ willingness to pay for these bottles. The exit questionnaire also shows that participants would prefer the exclusive use of the omega-3 label posted on the bottle with the highest content in omega-3. From an interpretation of questionnaires and elicited willingness to pay, simulations show that the exclusive use of one label signaling omega-3 would have a positive impact on both profits and consumers’ surpluses.

Suggested Citation

  • Marette Stéphan, 2014. "Economic Benefits Coming from the Absence of Labels Proliferation," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 12(1), pages 1-9, January.
    • Handle: RePEc:bpj:bjafio:v:12:y:2014:i:1:p:9:n:3
    DOI: 10.1515/jafio-2013-0014
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    References listed on IDEAS

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    1. Lusk Jayson L. & Marette Stéphan, 2012. "Can Labeling and Information Policies Harm Consumers?," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 10(1), pages 1-15, October.
    2. Matthew Rousu & Wallace E. Huffman & Jason F. Shogren & Abebayehu Tegene, 2007. "Effects And Value Of Verifiable Information In A Controversial Market: Evidence From Lab Auctions Of Genetically Modified Food," Economic Inquiry, Western Economic Association International, vol. 45(3), pages 409-432, July.
    3. Wansink, Brian & Sonka, Steven T. & Hasler, Clare M., 2004. "Front-label health claims: when less is more," Food Policy, Elsevier, vol. 29(6), pages 659-667, December.
    4. Loureiro, Maria L. & McCluskey, Jill J. & Mittelhammer, Ronald C., 2001. "Assessing Consumer Preferences For Organic, Eco-Labeled, And Regular Apples," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 26(2), pages 1-13, December.
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    Cited by:

    1. Marette, Stephan, 2017. "Quality, market mechanisms and regulation in the food chain," Bio-based and Applied Economics Journal, Italian Association of Agricultural and Applied Economics (AIEAA), vol. 5(3), February.
    2. Yokessa, Maïmouna & Marette, Stéphan, 2019. "A Review of Eco-labels and their Economic Impact," International Review of Environmental and Resource Economics, now publishers, vol. 13(1-2), pages 119-163, April.
    3. Oranuch Wongpiyabovorn & Alejandro Plastina & John M. Crespi, 2021. "US Agriculture as a Carbon Sink: From International Agreements to Farm Incentives," Center for Agricultural and Rural Development (CARD) Publications 21-wp627, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    4. Olivier Bonroy & Christos Constantatos, 2015. "On the Economics of Labels: How Their Introduction Affects the Functioning of Markets and the Welfare of All Participants," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 97(1), pages 239-259.
    5. Stéphan Marette, 2022. "Open questions about local food," Review of Agricultural, Food and Environmental Studies, Springer, vol. 103(1), pages 91-96, March.
    6. Oranuch Wongpiyabovorn & Alejandro Plastina & John M. Crespi, 2023. "Challenges to voluntary Ag carbon markets," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 45(2), pages 1154-1167, June.
    7. Gregory Colson & Carola Grebitus, 2017. "Relationship between Children's BMI and Parents’ Preferences for Kids’ Yogurts with and without Front of Package Health Signals," Agribusiness, John Wiley & Sons, Ltd., vol. 33(2), pages 151-159, April.

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