Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/145556
Authors: 
Tebbe, Eva
von Blanckenburg, Korbinian
Year of Publication: 
2016
Series/Report no.: 
Beiträge zur Jahrestagung des Vereins für Socialpolitik 2016: Demographischer Wandel - Session: Environmental Economics: Consequences and Perceptions A15-V2
Abstract: 
The environmental need for and economic opportunities provided by sustainability in food production are becoming increasingly popular in both society and research. Interacting with this, labels signaling sustainable product attributes are gaining importance, although uncertainty concerning the environmental, micro- and macroeconomic benefits of such labels persist. One of the questions still incompletely answered is whether consumers are willing to pay more for labeled than for unlabeled products and whether this willingness increases with the number of labels on a food product. To tackle this question, we conduct a laboratory experiment, testing consumer valuations of different labeling strategies. Using the Becker-deGroot-Marschak mechanism, consumer willingness to pay (WTP) for 15 food products is measured. The products were endowed with up to six different sustainability labels, such that each grocery item was available in eight product versions. 191 respondents were allocated to groups, of which each was confronted with a different set of product versions. In order to compare labeling schemes across all products, we calculated an aggregated standardized relativized WTP. The results indicate that participants are prone to allocating WTP premiums to labeled products, more than to unlabeled products. However, the premiums do not vary with an increasing number of labels, independent of whether the labels signal substitute or complementary sustainability information. Thus, the results are not entirely in line with normative notions of magnitude variation, but rather with behavioral economic concepts.
JEL: 
L15
D12
D44
Document Type: 
Conference Paper

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