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Consumer Willingness to Pay for Genetically Modified Food Labels in a Market with Diverse Information: Evidence from Experimental Auctions
Huffman, W. E. Shogren, Jason F. Rousu, M. Tegene, A.
Huffman, W. E.
Shogren, Jason F.
Rousu, M.
Tegene, A.
Abstract
Description
With the continuing controversy over genetically modified (GM) foods, some groups advocate mandatory labeling of these products, while other groups oppose labeling. An important issue is how GM labels affect consumers' willingness to pay for these food products in the market. Using a statistically based economics experiment with adult consumers as subjects, we examine how willingness to pay changes for three food products--vegetable oil, tortilla chips, and potatoes--when GM labels are introduced. Participants in the experiments discounted GM-labeled foods by approximately 14% relative to their standard-labeled counterparts. The evidence also showed that sequencing of food labels affects willingness to pay, and that randomizing treatments is an important methodological feature in experiments of willingness to pay.
Date
2003-12-01
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Publisher
University of Wyoming. Libraries
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Keywords
consumer demand,corn chips,experimental economics,food labels,genetic modification,GM foods,laboratory auctions,potatoes,vegetable oil,willingness to pay,Economics