RESEARCH ARTICLE
The effect of product quantity on willingness to pay: A meta-regression analysis of beef valuation studies
Wen Lin,
Corresponding Author
Wen Lin
China Academy for Rural Development, School of Public Affairs, Zhejiang University, Hangzhou, China
Correspondence Wen Lin, China Academy for Rural Development, School of Public Affairs, Zhejiang University, Hangzhou 310058, China.
Email: [email protected]
Search for more papers by this authorWen Lin,
Corresponding Author
Wen Lin
China Academy for Rural Development, School of Public Affairs, Zhejiang University, Hangzhou, China
Correspondence Wen Lin, China Academy for Rural Development, School of Public Affairs, Zhejiang University, Hangzhou 310058, China.
Email: [email protected]
Search for more papers by this authorAbstract
Stated preference methods in food economics typically focus on willingness to pay for high food quality of a fixed product quantity, ignoring the role of product quantity on welfare estimates. This study demonstrates that product quantity matters in beef valuation studies both theoretically and empirically. We find that when product quantity can be chosen freely by individuals, the price premium for improved quality per beef product decreases with beef product quantity. A meta-regression analysis conducted on beef valuation studies shows the extent of the impact of product quantity. When beef product quantity increases by 100 g, the percentage price premium declines by 2−4 percentage points, which differs across model specifications and samples. The implications for willingness to pay estimates and the design of stated preference methods are discussed in line with the results. [EconLit Citations: D10, D60, Q18].
CONFLICT OF INTEREST STATEMENT
The author declares no conflict of interest.
Open Research
DATA AVAILABILITY STATEMENT
The data that support the findings of this study are available from the corresponding author upon reasonable request.
Supporting Information
| Filename | Description |
|---|---|
| agr21798-sup-0001-supmat.docx33 KB | Supporting information. |
Please note: The publisher is not responsible for the content or functionality of any supporting information supplied by the authors. Any queries (other than missing content) should be directed to the corresponding author for the article.
REFERENCES
- Adalja, A., Hanson, J., Towe, C., & Tselepidakis, E. (2015). An examination of consumer willingness to pay for local products. Agricultural and Resource Economics Review, 44(3), 253–274.
10.1017/S1068280500005050 Google Scholar
- Akaichi, F., Nayga, Jr. R. M., & Gil, J. M. (2012). Assessing consumers' willingness to pay for different units of organic milk: Evidence from multiunit auctions. Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, 60(4), 469–494.
- Alfnes, F., & Rickertsen, K. (2003). European consumers' willingness to pay for US beef in experimental auction markets. American Journal of Agricultural Economics, 85(2), 396–405.
- Angulo, A. M., Gil, J. M., & Tamburo, L. (2005). Food safety and consumers' willingness to pay for labelled beef in Spain. Journal of Food Products Marketing, 11(3), 89–105.
10.1300/J038v11n03_06 Google Scholar
- Arechar, A. A., Gächter, S., & Molleman, L. (2018). Conducting interactive experiments online. Experimental Economics, 21(1), 99–131.
- Beriain, M. J., Sanchez, M., & Carr, T. R. (2009). A comparison of consumer sensory acceptance, purchase intention, and willingness to pay for high quality United States and Spanish beef under different information scenarios. Journal of Animal Science, 87(10), 3392–3402.
- Bhat, C. R. (2018). A new flexible multiple discrete–continuous extreme value (MDCEV) choice model. Transportation Research Part B: Methodological, 110, 261–279.
- Bhat, C. R., Castro, M., & Pinjari, A. R. (2015). Allowing for complementarity and rich substitution patterns in multiple discrete–continuous models. Transportation Research Part B: Methodological, 81, 59–77.
- Britwum, K., & Yiannaka, A. (2019). Consumer willingness to pay for food safety interventions: The role of message framing and issue involvement. Food Policy, 86, 101726.
- Caputo, V., Scarpa, R., & Nayga, R. M. (2017). Cue versus independent food attributes: The effect of adding attributes in choice experiments. European Review of Agricultural Economics, 44(2), 211–230.
- Card, D., & Krueger, A. B. (1995). Time-series minimum-wage studies: A meta-analysis. The American Economic Review, 85(2), 238–2.
- Carlsson, F., Frykblom, P., & Lagerkvist, C. J. (2007). Consumer willingness to pay for farm animal welfare: Mobile abattoirs versus transportation to slaughter. European Review of Agricultural Economics, 34(3), 321–344.
- Carson, R. T., & Mitchell, R. C. (1993). The issue of scope in contingent valuation studies. American Journal of Agricultural Economics, 75(5), 1263–1267.
- Clark, B., Stewart, G. B., Panzone, L. A., Kyriazakis, I., & Frewer, L. J. (2017). Citizens, consumers and farm animal welfare: A meta-analysis of willingness-to-pay studies. Food Policy, 68, 112–127.
- Corrigan, J. R., Depositario, D. P. T., Nayga, Jr. R. M., Wu, X., & Laude, T. P. (2009). Comparing open-ended choice experiments and experimental auctions: An application to golden rice. American Journal of Agricultural Economics, 91(3), 837–853.
- Corrigan, J. R., & Rousu, M. C. (2006). Posted prices and bid affiliation: Evidence from experimental auctions. American Journal of Agricultural Economics, 88(4), 1078–1090.
- Corsi, A. (2005). Consumers' short-and long-term response to “Mad Cow”: Beef consumption and willingness-to-pay for organic beef in Italy (No. 724-2016-49084).
- Corsi, A. (2007). Ambiguity of measured WTP for quality improvements when quantity is unconstrained: A note. European Review of Agricultural Economics, 34(4), 501–515.
- Corsi, A., & Novelli, S. (2003). Measuring quantity-constrained and maximum prices consumers are willing to pay for quality improvements: The case of organic beef meat (No. 1002-2016-78284).
- Dennis, E. J., Tonsor, G. T., & Lusk, J. L. (2021). Choosing quantities impacts individuals choice, rationality, and willingness to pay estimates. Agricultural Economics, 52(6), 945–962.
- Deselnicu, O. C., Costanigro, M., Souza-Monteiro, D. M., & McFadden, D. T. (2013). A meta-analysis of geographical indication food valuation studies: What drives the premium for origin-based labels? Journal of Agricultural and Resource Economics, 32, 204–219.
- Diamond, P. A., & Hausman, J. A. (1994). Contingent valuation: Is some number better than no number? Journal of Economic Perspectives, 8(4), 45–64.
- Dickinson, D. L., & Bailey, D. (2002). Meat traceability: Are US consumers willing to pay for it? Journal of Agricultural and Resource Economics, 32, 348–364.
- Dolgopolova, I., & Teuber, R. (2018). Consumers' willingness to pay for health benefits in food products: A meta-analysis. Applied Economic Perspectives and Policy, 40(2), 333–352.
- Elbakidze, L., Nayga, Jr. R. M., & Li, H. (2013). Willingness to pay for multiple quantities of animal welfare dairy products: Results from random Nth-, second-price, and incremental second-price auctions. Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, 61(3), 417–438.
- Elbakidze, L., Nayga, Jr. R. M., Li, H., & McIntosh, C. (2014). Value elicitation for multiple quantities of a quasi-public good using open ended choice experiments and uniform price auctions. Agricultural Economics, 45(2), 253–265.
- Evans, J. R., D'Souza, G. E., Collins, A., Cheryl, B., & Sperow, M. (2011). Determining consumer perceptions of and willingness to pay for appalachian grass-fed beef: An experimental economics approach. Agricultural and Resource Economics Review, 40(2), 233–250.
10.1017/S1068280500008030 Google Scholar
- Feuz, D. M., Umberger, W. J., Calkins, C. R., & Sitz, B. (2004). US consumers' willingness to pay for flavor and tenderness in steaks as determined with an experimental auction. Journal of Agricultural and Resource Economics, 29, 501–516.
- Florax, R. J., Travisi, C. M., & Nijkamp, P. (2005). A meta-analysis of the willingness to pay for reductions in pesticide risk exposure. European Review of Agricultural Economics, 32(4), 441–467.
- Gao, Z., & Schroeder, T. C. (2009). Effects of label information on consumer willingness-to-pay for food attributes. American Journal of Agricultural Economics, 91(3), 795–809.
- Glass, G. V. (1976). Primary, secondary, and meta-analysis of research. Educational Researcher, 5(10), 3–8.
10.3102/0013189X005010003 Google Scholar
- Gracia, A., Loureiro, M. L., & Nayga Jr, R. M. (2011). Are valuations from nonhypothetical choice experiments different from those of experimental auctions? American Journal of Agricultural Economics, 93(5), 1358–1373.
- Grannis, J. L., Hooker, N. H., & Thilmany, D. D. (2000). Consumer preference for specific attributes in natural beef products (No. 1841-2016-152284).
- Green, D. P., Kahneman, D., & Kunreuther, H. (1994). How the scope and method of public funding affect willingness to pay for public goods. Public Opinion Quarterly, 58(1), 49–67.
- Hirsch, S., Petersen, T., Koppenberg, M., & Hartmann, M. (2022). CSR and firm profitability: Evidence from a meta-regression analysis. Journal of Economic Surveys.
- Hoerl, A. E., & Kennard, R. W. (1970). Ridge regression: Biased estimation for nonorthogonal problems. Technometrics, 12(1), 55–67.
- Huffman, W. E., & McCluskey, J. J. (2017). Using stated preference techniques and experimental auction methods: A review of advantages and disadvantages for each method in examining consumer preferences for new technology. International Review of Environmental and Resource Economics, 10(3−4), 269–297.
10.1561/101.00000088 Google Scholar
- Iyengar, R., & Jedidi, K. (2012). A conjoint model of quantity discounts. Marketing Science, 31(2), 334–350.
- Lagerkvist, C. J., & Hess, S. (2011). A meta-analysis of consumer willingness to pay for farm animal welfare. European Review of Agricultural Economics, 38(1), 55–78.
- Lancaster, K. J. (1966). A new approach to consumer theory. Journal of Political Economy, 74(2), 132–157.
- Lewis, K. E., Grebitus, C., Colson, G., & Hu, W. (2017). German and British consumer willingness to pay for beef labeled with food safety attributes. Journal of Agricultural Economics, 68(2), 451–470.
- Lin, W., Ortega, D. L., & Caputo, V. (2022). Experimental quantity, mental budgeting and food choice: A discrete choice experiment application. European Review of Agricultural Economics.
- List, J. A., & Gallet, C. A. (2001). What experimental protocol influence disparities between actual and hypothetical stated values? Environmental and Resource Economics, 20(3), 241–254.
- Loomis, J. (2011). What's to know about hypothetical bias in stated preference valuation studies?: Hypothetical bias in stated preference valuation studies. Journal of Economic Surveys, 25(2), 363–370.
- Lusk, J. L., Fields, D., & Prevatt, W. (2008). An incentive compatible conjoint ranking mechanism. American Journal of Agricultural Economics, 90(2), 487–498.
- Lusk, J. L., Jamal, M., Kurlander, L., Roucan, M., & Taulman, L. (2005). A meta-analysis of genetically modified food valuation studies. Journal of Agricultural and Resource Economics, 30, 28–44.
- Lusk, J. L., & Schroeder, T. C. (2006). Auction bids and shopping choices. Advances in Economic Analysis & Policy, 6(1).
- Maples, J. G., Lusk, J. L., & Peel, D. S. (2018). Unintended consequences of the quest for increased efficiency in beef cattle: When bigger isn't better. Food Policy, 74, 65–73.
- McCluskey, J. J., Grimsrud, K. M., Ouchi, H., & Wahl, T. I. (2005). Bovine spongiform encephalopathy in Japan: Consumers' food safety perceptions and willingness to pay for tested beef. The Australian Journal of Agricultural and Resource Economics, 49(2), 197–209.
- McKay, L., DeLong, K. L., Jensen, K. L., Griffith, A. P., & Boyer, C. N. (2018). Restaurants' willingness to pay for Tennessee certified beef (No. 2015-2018-146).
- Moher, D., Liberati, A., Tetzlaff, J., Altman, D. G., & PRISMA Group*. (2009). Preferred reporting items for systematic reviews and meta-analyses: The PRISMA statement. Annals of Internal Medicine, 151(4), 264–269.
- Mullainathan, S., & Spiess, J. (2017). Machine learning: An applied econometric approach. Journal of Economic Perspectives, 31(2), 87–106.
- Murphy, J. J., Allen, P. G., Stevens, T. H., & Weatherhead, D. (2005). A meta-analysis of hypothetical bias in stated preference valuation. Environmental & Resource Economics, 30(3), 313–325.
- Nayga, R. M., Jr. Poghosyan, A., & Nichols, J. P. (2002). Consumer willingness to pay for irradiated beef, Paradoxes in food chains and networks: Proceedings of the Fifth International Conference on Chain and Network Management in Agribusiness and the Food Industry (Noordwijk, 6−8 June 2002) (p. 250). Wageningen Academic Publishers.
- Nelson, J. P., & Kennedy, P. E. (2009). The use (and abuse) of meta-analysis in environmental and natural resource economics: an assessment. Environmental and resource economics, 42(3), 345–377.
- Ortega, D. L., & Wolf, C. A. (2018). Demand for farm animal welfare and producer implications: Results from a field experiment in Michigan. Food Policy, 74, 74–81.
- Penn, J., & Hu, W. (2019). Cheap talk efficacy under potential and actual hypothetical bias: A meta-analysis. Journal of Environmental Economics and Management, 96, 22–35.
- Penn, J. M., & Hu, W. (2018). Understanding hypothetical bias: An enhanced meta-analysis. American Journal of Agricultural Economics, 100(4), 1186–1206.
- Penn, J. M., & Hu, W. (2021). The extent of hypothetical bias in willingness to accept. American Journal of Agricultural Economics, 103(1), 126–141.
- Printezis, I., Grebitus, C., & Hirsch, S. (2019). The price is right!? A meta-regression analysis on willingness to pay for local food. PLoS One, 14(5), e0215847.
- Scarpa, R., Zanoli, R., Bruschi, V., & Naspetti, S. (2013). Inferred and stated attribute non-attendance in food choice experiments. American Journal of Agricultural Economics, 95(1), 165–180.
- Snowberg, E., & Yariv, L. (2021). Testing the waters: Behavior across participant pools. American Economic Review, 111(2), 687–719.
- Stanley, T. D. (2001). Wheat from chaff: Meta-analysis as quantitative literature review. Journal of Economic Perspectives, 15(3), 131–150.
- Stanley, T. D. (2008). Meta-regression methods for detecting and estimating empirical effects in the presence of publication selection. Oxford Bulletin of Economics and Statistics, 70(1), 103–127.
- Stanley, T. D., & Doucouliagos, H. (2012). Meta-regression analysis in economics and business. Routledge.
10.4324/9780203111710 Google Scholar
- Stanley, T. D., Doucouliagos, H., Giles, M., Heckemeyer, J. H., Johnston, R. J., Laroche, P., Nelson, J. P., Paldam, M., Poot, J., Pugh, G., Rosenberger, R. S., & Rost, K. (2013). Meta-analysis of economics research reporting guidelines. Journal of Economic Surveys, 27(2), 390–394.
- Stanley, T. D., & Jarrell, S. B. (2005). Meta-regression analysis: A quantitative method of literature surveys. Journal of Economic Surveys, 19(3), 299–308.
- Tibshirani, R. (1997). The lasso method for variable selection in the Cox model. Statistics in Medicine, 16(4), 385–395.
10.1002/(SICI)1097-0258(19970228)16:4<385::AID-SIM380>3.0.CO;2-3 CAS PubMed Web of Science® Google Scholar
- Tonsor, G. T., Schroeder, T. C., Fox, J. A., & Biere, A. (2005). European preferences for beef steak attributes. Journal of Agricultural and Resource Economics, 30, 367–380.
- Tonsor, G. T., & Shupp, R. (2009). Valuations of ‘sustainably produced'labels on beef, tomato, and apple products. Agricultural and Resource Economics Review, 38(3), 371–383.
10.1017/S106828050000962X Google Scholar
- Tully, S. M., & Winer, R. S. (2014). The role of the beneficiary in willingness to pay for socially responsible products: A meta-analysis. Journal of Retailing, 90(2), 255–274.
- Tunçel, T., & Hammitt, J. K. (2014). A new meta-analysis on the WTP/WTA disparity. Journal of Environmental Economics and Management, 68(1), 175–187.
- Varian, H. R. (2014). Big data: New tricks for econometrics. Journal of Economic Perspectives, 28(2), 3–28.
- Wang, Q., & Zhao, D. (2019). Penalization methods with group-wise sparsity: Econometric applications to eBay motors online auctions. Empirical Economics, 57(2), 683–704.
- Van Wezemael, L., Caputo, V., Nayga, Jr., R. M., Chryssochoidis, G., & Verbeke, W. (2014). European consumer preferences for beef with nutrition and health claims: A multi-country investigation using discrete choice experiments. Food Policy, 44, 167–176.
- Yang, W., & Renwick, A. (2019). Consumer willingness to pay price premiums for credence attributes of livestock products—A meta-analysis. Journal of Agricultural Economics, 70(3), 618–639.
