Consumer Attitudes, Willingness to Pay and Revealed Preferences for Different Egg Production Attributes: Analysis of Canadian Egg Consumers
The Canadian egg industry has introduced a number of specialty eggs, including Omega-3, organic, free run/range, vitamin enhanced and vegetarian over the past few decades. These eggs are generally sold at prices higher than the ‘normal’ egg and there has been little analysis of the consumer awareness of and interest in purchasing these eggs. All previous econometric analysis of the Canadian egg market has assumed eggs and consumers are homogeneous. This study makes use of Stated preference and Revealed preference data to model the consumer interest in the different egg types. Stated preference surveys were conducted in two separate years: 2005 during which consumers were surveyed on their interest in Omega-3 and Vitamin Enhanced eggs relative to ‘normal’ eggs, white large, Grade A eggs, and 2006 during which consumers were surveyed on their interest in organic, freerun and vegetarian eggs relative to brown Grade-A eggs. Consumers were also assessed on their health behaviour, health consciousness, and in 2006 on their attitudes towards animal welfare, novelty foods, and environmental concerns. Results from this phase of the research suggested that among the sample of Alberta consumers, there is only modest interest in the specialty eggs, eggs, in general, are associated with other healthy behaviours, health conscious consumers are willing to pay more for specialty eggs, of all types, older consumers and consumers with families are significantly more price sensitive and hence, have constraints on their ability to purchase specialty eggs. As well, consumers with concerns about animal welfare will pay more for free run eggs, there is an increased interest in eggs with identified health attributes among older consumers. Revealed preference analysis of actual purchase behaviour was conducted on an A C Nielsen Homescan© panel data set over a three year period. Separate analyses were conducted for Alberta and Ontario frequent egg purchasers, with some significant differences across provinces. In Alberta no one is willing to pay more for specialty eggs than for normal eggs, with either modeling technique applied. In Ontario this assessment is less clear, the frequency model of how often across a three year period households purchased each type of egg, would suggest that consumers are willing to pay more for specialty eggs than for ‘normal’ eggs, with organic the egg that they are willing to pay the most for. At the same time the choice model for Ontario, a model of actual purchases across time with the type of egg as the dependent variable, suggests that consumers are willing to pay the most for ‘normal’ eggs with Free run and Organic close behind. Overall, as we look more closely at the relative ranking of specialty eggs, at the mean of all variables, organic eggs are the ones all households are willing to pay the most for. In the frequency model Alberta consumers’s willingness to pay for organic eggs is closest to the normal egg and Ontario consumers would pay $1.72 relative to normal eggs. The choice model exhibits similar patterns. Free run eggs are also popular in Ontario, but less so than organic. One of the findings of the study is that there may be some misunderstanding of the relative nutritional benefits of the different types of eggs or other human health aspects of agricultural production. Health seems to be an issue in the purchase of organic eggs as much as it does in the purchase of Omega-3 eggs. Further specific research on the reasons why consumers purchase organic would allow the industry to develop better marketing tools.
|Date of creation:||2007|
|Contact details of provider:|| Postal: 515 General Services Building, University of Alberta, Edmonton, AlbertaT6G 2H1|
Phone: (780) 492-4225
Fax: (780) 492-0268
Web page: http://www.rees.ualberta.ca/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- K. M. Chyc & E. W. Goddard, 1994. "Optimal investment in generic advertising and research: The case of the Canadian supply-managed egg market," Agribusiness, John Wiley & Sons, Ltd., vol. 10(2), pages 145-166.
- Keane, Michael, 1997. "Current Issues in Discrete Choice Modeling," MPRA Paper 52515, University Library of Munich, Germany.
- Huffman, Wallace E. & Shogren, Jason F. & Rousu, Matthew C. & Tegene, Abebayehu, 2003.
"Consumer Willingness to Pay for Genetically Modified Food Labels in a Market with Diverse Information: Evidence from Experimental Auctions,"
Journal of Agricultural and Resource Economics,
Western Agricultural Economics Association, vol. 28(03), December.
- Huffman, Wallace & Shogren, J. E. & Rousu, M. & Tegene, Abebayehu, 2003. "Consumer Willingness to Pay for Genetically Modified Food Labels in a Market with Diverse Information: Evidence from Experimental Auctions," Staff General Research Papers Archive 12256, Iowa State University, Department of Economics.
- Bennett, Richard M. & Blaney, Ralph J.P., 2003. "Estimating the benefits of farm animal welfare legislation using the contingent valuation method," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 29(1), July.
- Atsushi Maruyama & Masao Kikuchi, 2004. "Risk-learning process in forming willingness-to-pay for egg safety," Agribusiness, John Wiley & Sons, Ltd., vol. 20(2), pages 167-179.
- Tülin Erdem & Susumu Imai & Michael Keane, 2003. "Brand and Quantity Choice Dynamics Under Price Uncertainty," Quantitative Marketing and Economics (QME), Springer, vol. 1(1), pages 5-64, March.
- Erdem, Tulin & Imai, Susumu & Keane, Michael, 2003. "Brand and Quantity Choice Dynamics Under Price Uncertainty," MPRA Paper 52516, University Library of Munich, Germany.
- Jayson L. Lusk & Darren Hudson, 2004. "Willingness-to-Pay Estimates and Their Relevance to Agribusiness Decision Making," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 26(2), pages 152-169.
- Cason, Timothy N. & Gangadharan, Lata, 2002. "Environmental Labeling and Incomplete Consumer Information in Laboratory Markets," Journal of Environmental Economics and Management, Elsevier, vol. 43(1), pages 113-134, January.
- Cason, T.N. & Gangadharan, L., 1999. "Environmental Labeling and Incomplete Consumer Information in Laboratory Markets," Department of Economics - Working Papers Series 708, The University of Melbourne.
- David L. Sunding, 2003. "The Role for Government in Differentiated Product Markets: Looking to Economic Theory," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(3), pages 720-724.
- Barewal, S. & Goddard, D., 1985. "The Parameters of Consumer Food Demand in Canada," Working Papers 243862, Agriculture and Agri-Food Canada.
- Bennett, Richard M. & Blaney, Ralph J. P., 2003. "Estimating the benefits of farm animal welfare legislation using the contingent valuation method," Agricultural Economics, Blackwell, vol. 29(1), pages 85-98, July.
- Chintagunta, Pradeep & Kyriazidou, Ekaterini & Perktold, Josef, 2001. "Panel data analysis of household brand choices," Journal of Econometrics, Elsevier, vol. 103(1-2), pages 111-153, July.
- Park, Changwon & Senauer, Benjamin, 1996. "Estimation Of Household Brand-Size Choice Models For Spaghetti Products With Scanner Data," Working Papers 14336, University of Minnesota, The Food Industry Center.
- Boxall, Peter C. & Adamowicz, Wiktor L. & Swait, Joffre & Williams, Michael & Louviere, Jordan, 1996. "A comparison of stated preference methods for environmental valuation," Ecological Economics, Elsevier, vol. 18(3), pages 243-253, September.
- Mary Lou McCutcheon & Ellen Goddard, 1992. "Optimal Producer and Social Payoff from Generic Advertising: The Case of the Canadian Supply-managed Egg Sector," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 40(1), pages 1-24, 03.
- Wanki Moon & Wojciech J. Florkowski & Bernhard Brückner & Ilona Schonhof, 2002. "Willingness to Pay for Environmental Practices: Implications for Eco-Labeling," Land Economics, University of Wisconsin Press, vol. 78(1), pages 88-102.
- repec:ags:faprsr:32047 is not listed on IDEAS
- Keane, Michael P, 1997. "Modeling Heterogeneity and State Dependence in Consumer Choice Behavior," Journal of Business & Economic Statistics, American Statistical Association, vol. 15(3), pages 310-327, July.
- Chen, Kevin Z. & Chen, Chen, 2000. "Cross Product Censoring In A Demand System With Limited Dependent Variables: A Multivariate Probit Model Approach," Staff Paper Series 24073, University of Alberta, Department of Resource Economics and Environmental Sociology.
- Hailu, Getu & Goddard, Ellen W., 2004. "Nutrition and Health: Structural Analysis of Egg Consumption in Canada," 2004 Annual meeting, August 1-4, Denver, CO 19968, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association). Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:ags:ualbpr:52087. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.