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Do Consumers Pay More for What They Value More? The Case of Local Milk-based Dairy Products in Senegal

Published online by Cambridge University Press:  15 September 2016

Mélanie Lefèvre
Mélanie Lefèvre*
Affiliation:
LICOS Center for Institutions and Economic Performance, KU Leuven, and HEC Management School at University of Liège in Belgium
*
Correspondence: Mélanie Lefèvre ▪ LICOS Centre for Institutions and Economic Performance ▪ Waaistraat 6, Box 3511 ▪ B-3000 Leuven, Belgium ▪ Phone +32.16.37.90.53 ▪ Email melanie.lefevre@kuleuven.be.
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Abstract

Senegalese consumers prefer milk-based dairy products that are local and fresh to ones produced with imported powder. However, prices for fresh-milk-based and powder-based products are not significantly different. I address this puzzle by first confirming the preference using choice-based conjoint data to evaluate whether Senegalese consumers will pay a significant positive premium for fresh local products. I then identify price determinants using a unique dataset of milk product characteristics. The results verify the Senegalese preference for fresh local dairy products and show that consumers' misinformation regarding product composition prevents them from allocating a higher price to local milk-based products.

Keywords

choice-based conjoint analysishedonic regressionmilkpreference for local originSenegal
Type
Selected Papers
Information
Agricultural and Resource Economics Review , Volume 43 , Issue 1 , April 2014 , pp. 158 - 177
Copyright
Copyright © 2014 Northeastern Agricultural and Resource Economics Association 

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