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Consumer Values of Health-Related Food Symbols and Chemical Food Additives - The Case of Breakfast Cereals

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Abstract

In this paper we analyze consumers’ revealed values of food symbols indicating nutritious and organic food, as well as consumers’ revealed values for chemical food additives. We do so by estimating a hedonic price function based on a rich data set on breakfast cereal purchases. Our findings suggest that consumers positively value chemical food additives in breakfast cereals, suggesting that the positive taste effect from e.g. chemical taste enhancers, emulsifiers, colourings and preservatives outweighs consumers’ health concerns regarding such additives. We find no evidence that consumers positively value the symbol indicating nutritious food. In addition, surprisingly enough, our results imply that consumers have a negative willingness-to-pay for the symbol indicating organic food.

Suggested Citation

  • Thunström, Linda, 2009. "Consumer Values of Health-Related Food Symbols and Chemical Food Additives - The Case of Breakfast Cereals," HUI Working Papers 25, HUI Research.
  • Handle: RePEc:hhs:huiwps:0025
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    References listed on IDEAS

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    1. Kim, Sung-Yong & Nayga, Rodolfo M., Jr. & Capps, Oral, Jr., 2000. "The Effect Of Food Label Use On Nutrient Intakes: An Endogenous Switching Regression Analysis," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 25(01), July.
    2. Shi, Hongqi & Price, David W., 1998. "Impacts Of Sociodemographic Variables On The Implicit Values Of Breakfast Cereal Characteristics," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 23(01), July.
    3. Aronsson, Thomas & Thunström, Linda, 2008. "A note on optimal paternalism and health capital subsidies," Economics Letters, Elsevier, vol. 101(3), pages 241-242, December.
    4. Cropper, Maureen L & Deck, Leland B & McConnell, Kenneth E, 1988. "On the Choice of Functional Form for Hedonic Price Functions," The Review of Economics and Statistics, MIT Press, vol. 70(4), pages 668-675, November.
    5. Cassel, Eric & Mendelsohn, Robert, 1985. "The choice of functional forms for hedonic price equations: Comment," Journal of Urban Economics, Elsevier, vol. 18(2), pages 135-142, September.
    6. 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..
    7. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74, pages 132-132.
    8. Stanley, Linda R & Tschirhart, John, 1991. "Hedonic Prices for a Nondurable Good: The Case of Breakfast Cereals," The Review of Economics and Statistics, MIT Press, vol. 73(3), pages 537-541, August.
    9. Bo MacInnis & Gordon Rausser, 2005. "Does Food Processing Contribute to Childhood Obesity Disparities?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 87(5), pages 1154-1158.
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    Keywords

    consumer economics; hedonic pricing; food labelling; food additives;

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • I10 - Health, Education, and Welfare - - Health - - - General

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