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Using Stated Preference and Prior Purchase Intention in the Estimation of Willingness to Pay a Premium for Genetically Modified Foods
Author(s) -
Chiang JengTung,
Lin ChenYen,
Fu TsuTan,
Chen ChenHsin
Publication year - 2012
Publication title -
agribusiness
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.57
H-Index - 43
eISSN - 1520-6297
pISSN - 0742-4477
DOI - 10.1002/agr.20291
Subject(s) - willingness to pay , multinomial logistic regression , contingent valuation , preference , economics , valuation (finance) , estimation , econometrics , bounded function , microeconomics , marketing , business , statistics , mathematics , management , mathematical analysis , finance
This study provides an appropriate analytical approach using stated preference analysis and the contingent valuation method to investigate consumers’ willingness to pay a premium for genetically modified ( GM ) foods together with their prior purchase intentions. Although most analyses treat consumers’ attitudes and willingness to pay as separate issues, we introduce the idea of prior purchase intention to analyze these two issues as a whole. To achieve this purpose, a modeling technique invoking the multinomial logistic model and the accelerated failure time model is presented. Based on the data collected from an essential double‐bounded design, our empirical results suggest that Taiwanese consumers are willing to pay a premium of about 11 NT dollars (7% of the given average market price of 150 NT dollars for the non‐ GM salmon) to avoid GM ‐soybean‐fed salmon. In addition, the results of this study provide evidence that our stated‐preference double‐bounded design has a better‐off statistical efficiency than the single‐bounded one.