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Labels for a Local Food Speciality Product: The Case of Saffron

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  • Ana I. Sanjuán‐López
  • Helena Resano‐Ezcaray

Abstract

We examine the potential demand for a local food speciality product, saffron, with alternative labels, using a choice experiment. The paper contributes to the literature on credence attributes, by examining Willingness to Pay (WTP) for the local, organic and PDO (Protected Designation of Origin), their differences across experimental conditions (hypothetical and non‐hypothetical), and by identifying the effects of personal characteristics, in terms of socio‐demographics and level of product involvement on the differences in WTP. We find that the local saffron speciality has an important appeal that could be better reinforced with the PDO rather than the organic labelling, and that consumers show a consistent pattern of preferences across experimental environments. WTP tends to be higher in the hypothetical setting and, in particular, consumers with relatively more knowledge and deeper roots in the territory tend to exhibit a larger WTP premium for local origin and its certification. These results may help producers improve their marketing of agri‐food products with a high gastronomic value and differentiation potential, while they warn about an overstatement of WTP for socially desirable characteristics, such as organic labelling, which is also relevant for policymakers.

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  • Ana I. Sanjuán‐López & Helena Resano‐Ezcaray, 2020. "Labels for a Local Food Speciality Product: The Case of Saffron," Journal of Agricultural Economics, Wiley Blackwell, vol. 71(3), pages 778-797, September.
  • Handle: RePEc:bla:jageco:v:71:y:2020:i:3:p:778-797
    DOI: 10.1111/1477-9552.12376
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    2. Haghani, Milad & Bliemer, Michiel C.J. & Rose, John M. & Oppewal, Harmen & Lancsar, Emily, 2021. "Hypothetical bias in stated choice experiments: Part II. Conceptualisation of external validity, sources and explanations of bias and effectiveness of mitigation methods," Journal of choice modelling, Elsevier, vol. 41(C).
    3. Iannucci, Gianluca & Sacchi, Giovanna, 2021. "The evolution of organic market between third-party certification and participatory guarantee systems," Bio-based and Applied Economics Journal, Italian Association of Agricultural and Applied Economics (AIEAA), vol. 10(3), July.
    4. Haghani, Milad & Bliemer, Michiel C.J. & Rose, John M. & Oppewal, Harmen & Lancsar, Emily, 2021. "Hypothetical bias in stated choice experiments: Part I. Macro-scale analysis of literature and integrative synthesis of empirical evidence from applied economics, experimental psychology and neuroimag," Journal of choice modelling, Elsevier, vol. 41(C).
    5. Pengfei Liu & Lingling Hou & Dongqing Li & Shi Min & Yueying Mu, 2021. "Determinants of Livestock Insurance Demand: Experimental Evidence from Chinese Herders," Journal of Agricultural Economics, Wiley Blackwell, vol. 72(2), pages 430-451, June.

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