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Consumer willingness to pay for sustainability attributes in beer: A choice experiment using eco‐labels

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  • Aaron J. Staples
  • Carson J. Reeling
  • Nicole J. Olynk Widmar
  • Jayson L. Lusk

Abstract

Commercial and regional brewers are increasingly investing in environmental sustainability equipment that reduces input use, operating costs, and environmental impacts. These technologies often require prohibitively high upfront costs. One potential solution for these brewers is to market their product as sustainable and charge a premium to offset some of the costs. We undertake a stated preference choice experiment targeting a nationally representative sample of beer buyers and elicit preferences for multiple attributes related to environmental sustainability in beer. We find that, on average, beer buyers are willing to pay $0.70/six‐pack for beer produced using water and wastewater reduction technologies, $0.85 for carbon reduction practices, and $0.98 for landfill diversion practices, though water sustainability practices appeal to a largest share of beer buyers. We also find that preferences for sustainability attributes are widely distributed among beer drinkers, largely irrespective of sociodemographic characteristics. The positive price premiums across sustainability attributes suggest beer buyers value sustainable brewing, and brewers could attract new consumers by simultaneously communicating their commitment to sustainability and differentiating their product [EconLit Citations: D12, L66, M31].

Suggested Citation

  • Aaron J. Staples & Carson J. Reeling & Nicole J. Olynk Widmar & Jayson L. Lusk, 2020. "Consumer willingness to pay for sustainability attributes in beer: A choice experiment using eco‐labels," Agribusiness, John Wiley & Sons, Ltd., vol. 36(4), pages 591-612, October.
    • Handle: RePEc:wly:agribz:v:36:y:2020:i:4:p:591-612
    DOI: 10.1002/agr.21655
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    5. Cole, Matthew T. & McCullough, Michael, 2023. "California beer price posting: An exploratory analysis of pricing along the supply chain," Journal of Wine Economics, Cambridge University Press, vol. 18(3), pages 205-225, August.
    6. Tommaso Gallo & Francesco Pacchera & Chiara Cagnetti & Cecilia Silvestri, 2023. "Do Sustainable Consumers Have Sustainable Behaviors? An Empirical Study to Understand the Purchase of Food Products," Sustainability, MDPI, vol. 15(5), pages 1-21, March.
    7. Hart, Jarrett & Somerville, Scott & Sumner, Daniel A., 2022. "Brewery and Winery By-Product Markets: Environmental and Economic Benefits," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322322, Agricultural and Applied Economics Association.
    8. Fabio Boncinelli & Andrea Dominici & Federico Bondioni & Enrico Marone, 2024. "Consumers bahavior towards the country of origin labeling policy: The case of the pasta market in Italy," Agribusiness, John Wiley & Sons, Ltd., vol. 40(1), pages 46-69, January.
    9. Aaron J. Staples & Trey Malone & J. Robert Sirrine, 2021. "Hopping on the localness craze: What brewers want from state‐grown hops," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 42(2), pages 463-473, March.
    10. Alicia Rosburg & Carola Grebitus, 2021. "Sustainable development in the craft brewing industry: A case study of Iowa brewers," Business Strategy and the Environment, Wiley Blackwell, vol. 30(7), pages 2966-2979, November.
    11. Eleonora Sofia Rossi & José A. Zabala & Francesco Caracciolo & Emanuele Blasi, 2023. "The Value of Crop Diversification: Understanding the Factors Influencing Consumers’ WTP for Pasta from Sustainable Agriculture," Agriculture, MDPI, vol. 13(3), pages 1-18, February.
    12. Bass, Daniel A. & McFadden, Brandon R. & Messer, Kent D., 2021. "A case for measuring negative willingness to pay for consumer goods," Food Policy, Elsevier, vol. 104(C).

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