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An Examination of Consumer Willingness to Pay for Local Products

Published online by Cambridge University Press:  15 September 2016

Aaron Adalja*
Affiliation:
Department of Agricultural and Resource Economics at University of Maryland
James Hanson
Affiliation:
Department of Agricultural and Resource Economics at University of Maryland
Charles Towe
Affiliation:
Department of Agricultural and Resource Economics at University of Connecticut
Elina Tselepidakis
Affiliation:
U.S. Department of Agriculture Economic Research Service
*
Correspondence: Aaron AdaljaDepartment of Agricultural and Resource EconomicsUniversity of Maryland2200 Symons HallCollege Park MD 20742Phone 216.374.3136Email aadalja@umd.edu
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Abstract

We use data from hypothetical and nonhypothetical choice-based conjoint analysis to estimate willingness to pay for local food products. The survey was administered to three groups: consumers from a buying club with experience with local and grass-fed production markets, a random sample of Maryland residents, and shoppers at a nonspecialty Maryland supermarket. We find that random-sample and supermarket shoppers are willing to pay a premium for local products but view local and grass-fed production as substitutes. Conversely, buying-club members are less willing to pay for local production than the other groups but do not conflate local and grass-fed production.

Type
Research Article
Copyright
Copyright © 2015 Northeastern Agricultural and Resource Economics Association 

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