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A Belief-Preference Model of Choice for Experience and Credence Goods

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  • Costanigro, Marco
  • Onozaka, Yuko

Abstract

We develop a methodology addressing the issue of confounded beliefs and preferences in models of discrete choice. First, we formalize the theoretical framework and logical underpinnings of a belief-preference model of choice for experience and credence goods, where subjective beliefs relate to uncertain product quality. Then, we present the experimental procedure within the context of an online choice experiment studying consumer food preferences. The empirical strategy leverages information from a quality sorting task to identify and estimate beliefs, while choice data are used to recover preferences. By conditioning product choices on predicted quality perceptions, the issue of endogenous beliefs is resolved.

Suggested Citation

  • Costanigro, Marco & Onozaka, Yuko, 2018. "A Belief-Preference Model of Choice for Experience and Credence Goods," Working Papers 276053, Colorado State University, Department of Agricultural and Resource Economics.
    • Handle: RePEc:ags:csdawp:276053
    DOI: 10.22004/ag.econ.276053
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    2. Onozaka, Yuko & Saue, Vegar Veseth & Costanigro, Marco, 2018. "The Moderating Effect of Heterogeneous Beliefs on Consumer Preferences for a New Food Technology: The Case of Modified Atmospheric Packaging," 2018 Annual Meeting, August 5-7, Washington, D.C. 274068, Agricultural and Applied Economics Association.
    3. Onozaka, Yuko & Honkanen, Pirjo & Altintzoglou, Themistoklis, 2023. "Sustainability, perceived quality and country of origin of farmed salmon: Impact on consumer choices in the USA, France and Japan," Food Policy, Elsevier, vol. 117(C).

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