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Is mental accounting of farm produce associated with more consumption of own-produced food?

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  • Huang, Jiaqi
  • Antonides, Gerrit
  • Nie, Fengying

Abstract

This study examines whether mental accounting theory is applicable to consumption of own-produced food of smallholder farm households. We are motivated by the farm household's procedure of allocating own-produced food, and some evidence of inflexible use of own-produced food reserve. Using hypothetical scenarios of food reserve and consumption, we find that smallholder farm households show evidence of having a mental budget for own-produced food for self-consumption, tracking their consumption against the budget, and compensating for earlier over- or underconsumption. A substantial number of people used the reserve of their own produced food, exceeding their consumption needs, as their mental budget to guide their consumption, leading to an outcome of overconsumption of own produce. Furthermore, we explored factors of mental accounting and proposed policy implications of the study.

Suggested Citation

  • Huang, Jiaqi & Antonides, Gerrit & Nie, Fengying, 2020. "Is mental accounting of farm produce associated with more consumption of own-produced food?," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 88(C).
    • Handle: RePEc:eee:soceco:v:88:y:2020:i:c:s2214804320300501
    DOI: 10.1016/j.socec.2020.101594
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    More about this item

    Keywords

    Mental accounting; Food consumption; Own-produced food; Smallholder farm households;
    All these keywords.

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets

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