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The Marginal Willingness-to-Pay for Health Related Food Characteristics

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  • Thunström, Linda

    () (Department of Economics, Umeå University)

Abstract

With food, consumers often face a trade-off between taste and nutrition. A priori, it is not obvious which would be more important to the average consumer, so it is an empirical question how consumers value food characteristics that simultaneously affect taste and nutritional value. In this paper, Swedish consumer preferences regarding food characteristics in breakfast cereals, hard bread and potato products are analyzed. In particular, the value consumers attach to fat, fibre, salt and sugar is studied, as well as the value of easily accessible nutritional information provided by a nutrition symbol. The equations estimated are derived from a hedonic price model. The price data originates from a household panel and scanner data, whereas the corresponding data on food characteristics was collected manually in supermarkets or from producers. The value consumers attach to food characteristics are found to vary by product and the results also imply that these values could be sensitive to changes in the combination of characteristics in a product.

Suggested Citation

  • Thunström, Linda, 2007. "The Marginal Willingness-to-Pay for Health Related Food Characteristics," Umeå Economic Studies 724, Umeå University, Department of Economics.
  • Handle: RePEc:hhs:umnees:0724
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    References listed on IDEAS

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    1. Putnam, Judy & Allshouse, Jane & Kantor, Linda Scott, 2002. "U.S. Per Capita Food Supply Trends: More Calories, Refined Carbohydrates, and Fats," Food Review/ National Food Review, United States Department of Agriculture, Economic Research Service, vol. 25(3), pages 1-14.
    2. 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(1), pages 1-17, July.
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    4. Peter G. Moffatt & Simon A. Peters, 2004. "Pricing Personal Services: An Empirical Study of Earnings in the UK Prostitution Industry," Scottish Journal of Political Economy, Scottish Economic Society, vol. 51(5), pages 675-690, November.
    5. 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(1), pages 1-14, July.
    6. Benson, Earl D & Hansen, Julia L. & Schwartz Jr., Arthur & Smersh, Greg T., 1998. "Pricing Residential Amenities: The Value of a View," The Journal of Real Estate Finance and Economics, Springer, vol. 16(1), pages 55-73, January.
    7. Trenton G. Smith, 2004. "The McDonald’s Equilibrium. Advertising, empty calories, and the endogenous determination of dietary preferences," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 23(3), pages 383-413, December.
    8. Patrick Bajari & C. Lanier Benkard, 2005. "Demand Estimation with Heterogeneous Consumers and Unobserved Product Characteristics: A Hedonic Approach," Journal of Political Economy, University of Chicago Press, vol. 113(6), pages 1239-1276, December.
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    10. 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.
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    Cited by:

    1. Anna Kristina Edenbrandt & Sinne Smed & Léon Jansen, 2018. "A hedonic analysis of nutrition labels across product types and countries," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 45(1), pages 101-120.
    2. Schollenberg, Linda, 2011. "So how much do you pay for ethical consumption? Estimating the hedonic price for Fair Trade coffee in Sweden," HUI Working Papers 31, HUI Research.

    More about this item

    Keywords

    hedonic pricing; willingness to pay; food characteristics;

    JEL classification:

    • D10 - Microeconomics - - Household Behavior - - - General
    • I10 - Health, Education, and Welfare - - Health - - - General

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