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The Impact of Social Capital on the Implicit Price Paid by the Italian Consumer for Fair Trade Coffee

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  • Bosbach, Moritz
  • Maietta, Ornella Wanda

Abstract

Consumers in developed countries are increasingly interested in the consumption of food products incorporating ethical aspects, particularly fair trade products. These products are usually distributed in a network of World Shops and, more recently, in supermarkets and shopping centres. The fair trade product with the highest market share is coffee. This study aims to ascertain the implicit price paid by Italian consumers for the fair trade content of coffee and how this implicit price is influenced by the level of social capital of the territory where consumers live. The data utilised are scanner data, based on the purchase at supermarkets and shopping centres observed from 2005 to 2007, referred to a territorial unit that is the province. Since scanner data are used, the analysis can allow for the coffee attributes described by the labels: branded, organic, decaffeinated, fair trade, espresso, and so on. The approach followed is the application of an hedonic regression where the dependant variable is the coffee price while the regressors are coffee characteristics (fair trade content and coffee other attributes) and several indicators of provincial social capital, alternatively included.

Suggested Citation

  • Bosbach, Moritz & Maietta, Ornella Wanda, 2011. "The Impact of Social Capital on the Implicit Price Paid by the Italian Consumer for Fair Trade Coffee," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114371, European Association of Agricultural Economists.
  • Handle: RePEc:ags:eaae11:114371
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    File URL: http://purl.umn.edu/114371
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    References listed on IDEAS

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    1. Goddard, E. W. & Akiyama, T., 1989. "United States demand for coffee imports," Agricultural Economics, Blackwell, vol. 3(2), pages 147-159, May.
    2. Loureiro, Maria L. & Hine, Susan, 2002. "Discovering Niche Markets: A Comparison of Consumer Willingness to Pay for Local (Colorado Grown), Organic, and GMO-Free Products," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 34(03), pages 477-487, December.
    3. Catturani, I. & Nocella, Giuseppe & Romano, Donato & Stefani, Gianluca, 2008. "Segmenting the Italian coffee market: marketing opportunities for economic agents working along the international coffee chain," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 44146, European Association of Agricultural Economists.
    4. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
    5. Sellen, Daniel & Goddard, Ellen, 1997. "Weak Separability in Coffee Demand Systems," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 24(1), pages 133-144.
    6. Florent Besnard & Ornella Wanda Maietta & Massimiliano D'Alessio, 2006. "Le motivazioni all'acquisto dei prodotti del Commercio Equo e Solidale: un'analisi comparata sui consumatori delle botteghe del mondo in Emilia Romagna e in Campania," ECONOMIA AGRO-ALIMENTARE, FrancoAngeli Editore, vol. 10(2), pages 131-170.
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    Cited by:

    1. Cerjak, Marija & Naglić, Tatjana & Mesić, Željka & Tomić, Marina, 2015. "Croatian consumers' knowledge and attitudes towards Fair Trade," 143rd Joint EAAE/AAEA Seminar, March 25-27, 2015, Naples, Italy 202756, European Association of Agricultural Economists.

    More about this item

    Keywords

    hedonic price; coffee; fair trade; scanner data; Italian consumers; Consumer/Household Economics; Demand and Price Analysis; C50; D12; L66; Z13;

    JEL classification:

    • C50 - Mathematical and Quantitative Methods - - Econometric Modeling - - - General
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • L66 - Industrial Organization - - Industry Studies: Manufacturing - - - Food; Beverages; Cosmetics; Tobacco
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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