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Consumer Willingness to Pay for Locally Grown Produce Designed to Support Local Food Banks and Enhance Locally Grown Producer Markets

David B. Willis, Carlos Carpio (), Kathryn Boys and Emily D. Young

No 150288, 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. from Agricultural and Applied Economics Association

Abstract: This study investigates the possibility of using local food banks as a distributor in the local food supply chain. A mixed logit model is used to estimate the price premium consumers are willing to pay at retail outlets for locally grown products, if consumers have knowledge that a portion of the purchase price will be used as a donation to support local food banks. Estimates reveal that average households are willing to pay 11.68% ($0.17/lb) more for locally grown produce relative to non-locally grown, and 10.75% ($0.33/lb) more for locally produced animal products. When the locally grown product attribute is combined with a food bank donation the WTP premium increases to 22.33% ($0.33/lb) for produce and 20.50% ($0.64/lb) for animal products. Consumers are only willing to pay a small price premium for products that contain the donation attribute but are not locally grown. However, a strong complimentary relationship was found between the local and donation attribute which suggest consumers have a stronger preference to donate when purchasing locally grown products than when purchasing nonlocal products.

Keywords: Demand and Price Analysis; Food Consumption/Nutrition/Food Safety (search for similar items in EconPapers)
Pages: 29
Date: 2013
New Economics Papers: this item is included in nep-agr and nep-mkt
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DOI: 10.22004/ag.econ.150288

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