DEMAND FOR CREDENCE CHARACTERISTICS IN BEEF

Jukka Kola and Terhi Latvala

No 19703, 2002 Annual meeting, July 28-31, Long Beach, CA from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: The recent food crises in Europe have raised public concerns about the quality and safety of food. The growing concern among the consumers towards food safety issues has increased the demand for quality attributes. Most quality properties of food products can be considered as credence characteristics, quality of which cannot be inferred before the purchase, and sometimes not even after the purchase. The aim of this study is to evaluate, both qualitatively and quantitatively, the value of new information about and the information systems set for credence characteristics of beef. Economics of information is the theoretical framework. The quantitative approach focuses to measure the ex ante value of credence characteristics, and the method of contingent valuation is applied for this purpose. In the beef supply chain there are two parallel information-based policies in Finland, which will increase the credence characteristics of beef quality and safety. First, the National Quality Strategy was drawn up by all parties involved in foodstuffs production to express the competitive advantages and strengths of Finnish food products relating to quality, safety, ethics, and ecology. Secondly, a beef identification and labelling system of the European Union was developed primarily to secure the safety of beef products and to increase the transparency and traceability of beef products in the supply chain. Through these systems more information about the credence characteristics of beef safety and quality will be made available to consumers. Results indicate that 59 % of Finnish consumers are willing to pay more to get information about safety and quality of beef products. Consumers are most concerned with diseases caused by food of animal origin. In addition, consumers desire more information about the use of GMOs in livestock production, the country of origin, and use of hormones in livestock production. Key words: beef, information, credence attributes, contingent valuation, willingness to pay

Keywords: Demand; and; Price; Analysis (search for similar items in EconPapers)
Pages: 14
Date: 2002
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea02:19703

DOI: 10.22004/ag.econ.19703

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