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Measuring rural consumers’ willingness to pay for quality labels using experimental auctions: the case of aflatoxin-free maize in Kenya

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Listed:
  • Hugo Groote
  • Clare Narrod
  • Simon C. Kimenju
  • Charles Bett
  • Rosemarie P. B. Scott
  • Marites M. Tiongco
  • Zachary M. Gitonga

Abstract

Aflatoxins are a common health hazard in tropical countries, especially in rural areas. New methods to reduce aflatoxin levels in food staples, as well as cheaper test methods, are being developed, but consumers’ willingness to pay (WTP) for these improvements is unknown. A survey was conducted with a representative sample of rural consumers (1,344 in total, 63% women) in all major maize-production zones of Kenya. The survey included an experimental auction with maize products of different qualities. The results showed that many rural consumers were aware of aflatoxins, but few understood their health risks. Respondents were willing to pay a premium for maize tested for aflatoxins and labeled, but asked a high discount for maize that was visibly contaminated with moldy grain. The premium was higher for respondents with education and in regions with aflatoxicosis outbreaks. Knowledge of aflatoxins substantially reduced the overall WTP, but did not increase the WTP for tested maize. Welfare analysis indicates that mandatory testing would result in substantial benefits if the cost of testing can be lowered to below the premium.

Suggested Citation

  • Hugo Groote & Clare Narrod & Simon C. Kimenju & Charles Bett & Rosemarie P. B. Scott & Marites M. Tiongco & Zachary M. Gitonga, 2016. "Measuring rural consumers’ willingness to pay for quality labels using experimental auctions: the case of aflatoxin-free maize in Kenya," Agricultural Economics, International Association of Agricultural Economists, vol. 47(1), pages 33-45, January.
  • Handle: RePEc:bla:agecon:v:47:y:2016:i:1:p:33-45
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    Cited by:

    1. Santeramo, Fabio Gaetano & Lamonaca, Emilia, 2020. "Objective risk and subjective risk: The role of information in food supply chains," MPRA Paper 104515, University Library of Munich, Germany.
    2. Leavens, Laura & Bauchet, Jonathan & Ricker-Gilbert, Jacob, 2021. "After the project is over: Measuring longer-term impacts of a food safety intervention in Senegal," World Development, Elsevier, vol. 141(C).
    3. Kassie, Menale & Stage, Jesper & Diiro, Gracious & Muriithi, Beatrice & Muricho, Geoffrey & Ledermann, Samuel T. & Pittchar, Jimmy & Midega, Charles & Khan, Zeyaur, 2018. "Push–pull farming system in Kenya: Implications for economic and social welfare," Land Use Policy, Elsevier, vol. 77(C), pages 186-198.
    4. Apurba Shee & Carlo Azzarri & Beliyou Haile, 2019. "Farmers’ Willingness to Pay for Improved Agricultural Technologies: Evidence from a Field Experiment in Tanzania," Sustainability, MDPI, Open Access Journal, vol. 12(1), pages 1-13, December.
    5. Unnevehr, Laurian & Grace, Delia, 2013. "Aflatoxins: Finding solutions for improved food safety," 2020 vision focus 20, International Food Policy Research Institute (IFPRI).
    6. David M.A. Murphy & Dries Roobroeck & David R. Lee & Janice Thies, 2020. "Underground Knowledge: Estimating the Impacts of Soil Information Transfers Through Experimental Auctions†," American Journal of Agricultural Economics, John Wiley & Sons, vol. 102(5), pages 1468-1493, October.
    7. Gitonga, Zachary M. & De Groote, Hugo & Kassie, Menale & Tefera, Tadele, 2013. "Impact of metal silos on households’ maize storage, storage losses and food security: An application of a propensity score matching," Food Policy, Elsevier, vol. 43(C), pages 44-55.
    8. Moser, Christine & Hoffmann, Vivian, 2015. "Firm heterogeneity in food safety provision: Evidence from aflatoxin tests in Kenya:," IFPRI discussion papers 1416, International Food Policy Research Institute (IFPRI).
    9. Pradyot Ranjan Jena & Hugo Groote & Bibhu Prasad Nayak & Annina Hittmeyer, 2021. "Evolution of Fertiliser Use and its Impact on Maize Productivity in Kenya: Evidence from Multiple Surveys," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 13(1), pages 95-111, February.
    10. Andrew M. Johnson & Tahirou Abdoulaye & Bamikole Ayedun & Joan R. Fulton & Nicole J. Olynk Widmar & Akande Adebowale & Ranajit Bandyopadhyay & Victor Manyong, 2020. "Willingness to pay of Nigerian poultry producers and feed millers for aflatoxin‐safe maize," Agribusiness, John Wiley & Sons, Ltd., vol. 36(2), pages 299-317, April.
    11. Martin Julius Chegere & Razack Lokina & Agnes G. Mwakaje, 0. "The impact of hermetic storage bag supply and training on food security in Tanzania," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 0, pages 1-18.
    12. Martin Julius Chegere & Razack Lokina & Agnes G. Mwakaje, 2020. "The impact of hermetic storage bag supply and training on food security in Tanzania," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 12(6), pages 1299-1316, December.
    13. Murphy, David M. A., 2017. "Underground Knowledge: Soil Testing, Farmer Learning, and Input Demand in Kenya," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258372, Agricultural and Applied Economics Association.
    14. Hoffmann, Vivian & Moser, Christine & Saak, Alexander, 2019. "Food safety in low and middle-income countries: The evidence through an economic lens," World Development, Elsevier, vol. 123(C), pages 1-1.

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