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The Willingness to Pay of European Consumers for Jointly Produced Israeli – Palestinian Products

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  • Wendler, Cordula
  • Liebe, Ulf
  • Ihle, Rico
  • von Cramon-Taubadel, Stephan

Abstract

Ethical aspects of food products have become increasingly important for Western European consumers. One example of such ethical consumption attributes are “peace products”, commodities produced in peaceful economic cooperation between members of conflicting parties in areas of political conflict. In the context of the Israeli-Palestinian conflict, we investigate the willingness to pay of consumers from four European countries for two food products which are jointly produced by Israelis and Palestinians. We conduct a cross country web survey including a choice experiment addressed to the four European countries. Preference heterogeneity with regard to the willingness to pay for peace building products is taken into account by including survey questions on lifestyle factors, attitudes towards Israel, Palestine and the Israel-Palestinian conflict, personal and social norms as well as socio-demographics. Using random parameter logit models we find that consumers in Great Britain and Germany are willing to pay a premium first off all for European products compared with products from Israel or the Palestinian Territories alone. The willingness to pay for Israeli/Palestinian peace products is lower compared to the surplus for European products. But the cooperation product is favored instead of a single county product, just from Israel or the Palestinian Territories. Hence, cooperation in the form of joint production of peace products would generate benefits.

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Bibliographic Info

Paper provided by International Association of Agricultural Economists in its series 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil with number 126727.

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Date of creation: 29 Jun 2012
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Handle: RePEc:ags:iaae12:126727

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Keywords: Choice experiments; ethical consumption; Middle East conflict; willingness to pay; Community/Rural/Urban Development; International Relations/Trade; D12; M14; O57; Q13; Z13;

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  1. Edward A. Sayre, 2005. "Labor Market Conditions, Political Events and Palestinian Suicide Bombings," Labor and Demography 0504007, EconWPA.
  2. Michele Micheletti & Andreas Follesdal, 2007. "Shopping for Human Rights. An Introduction to the Special Issue," Journal of Consumer Policy, Springer, vol. 30(3), pages 167-175, September.
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  6. McFadden, Daniel, 1974. "The measurement of urban travel demand," Journal of Public Economics, Elsevier, vol. 3(4), pages 303-328, November.
  7. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74, pages 132.
  8. David Hensher & William Greene, 2003. "The Mixed Logit model: The state of practice," Transportation, Springer, vol. 30(2), pages 133-176, May.
  9. Loureiro, Maria L. & Umberger, Wendy J., 2003. "Estimating Consumer Willingness to Pay for Country-of-Origin Labeling," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 28(02), August.
  10. Loureiro, Maria L. & Lotade, Justus, 2005. "Do fair trade and eco-labels in coffee wake up the consumer conscience?," Ecological Economics, Elsevier, vol. 53(1), pages 129-138, April.
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