Assessing Consumers' Willingness to Pay for Different Units of Organic Milk: Evidence from Multiunit Auctions

Faical Akaichi, Rodolfo M. Nayga, José M. Gil

Research output: Contribution to journalArticlepeer-review

27 Citations (Scopus)

Abstract

Experimental auctions are normally conducted using single-unit auctions. In this paper, we use the multiunit Vickrey auction to assess the determinants of consumers' willingness to pay (WTP) for organic milk in a multiunit shopping scenario. We also analyze the effect of positive and negative information about organic farming on WTP. Our results suggest that consumers are willing to pay a premium for organic milk but that this WTP decreases with the number of units purchased. Results also suggest that health issues, high price of organic foods, taste, and lack of information on organic foods are factors that influence WTP for organic milk. The type of information provided also plays a relevant role. Specifically, we found that subjects' WTP responds positively to positive information about organic farming and responds negatively to negative information. The provision of both positive and negative information does not affect WTP.

Original languageEnglish
Pages (from-to)469-494
Number of pages26
JournalCanadian Journal of Agricultural Economics
Volume60
Issue number4
DOIs
Publication statusPublished - 2012 Dec

ASJC Scopus subject areas

  • Global and Planetary Change
  • Ecology
  • Animal Science and Zoology
  • Agronomy and Crop Science
  • Economics and Econometrics

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