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The Organic Food Premium: A Local Assessment in the UK

Gschwandtner, Adelina (2018) The Organic Food Premium: A Local Assessment in the UK. International Journal of the Economics of Business, . ISSN 1357-1516. E-ISSN 1466-1829. (doi:10.1080/13571516.2017.1389842)

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https://doi.org/10.1080/13571516.2017.1389842

Abstract

The present study combines stated and revealed preferences in order to estimate the hypothetical bias of a sample of organic food consumers from Canterbury in the UK. It uses contingent valuation and hedonic pricing to compare stated and revealed preferences and employs the Almost Ideal Demand System to estimate the elasticity of organic products. The results show that the average price premium is fairly large (approximately 10%). They also demonstrate, crucially, that the size of this estimate is encouragingly similar whether a willingness-to-pay or hedonic pricing method is used. The estimated elasticity of organic products is on average above one, suggesting an elastic response to pricing policy in the present sample. Desirable next steps and potential policy applications for future research are also discussed.

Item Type: Article
DOI/Identification number: 10.1080/13571516.2017.1389842
Uncontrolled keywords: contingent valuation method (CVM), hedonic pricing method (HPM), convergent validity, behavioural gap, organic food, price premium, almost ideal demand system (AIDS) JEL classification: C83, C90, D1, L81, Q18, Q21, Q51
Subjects: H Social Sciences
H Social Sciences > HB Economic Theory
H Social Sciences > HC Economic History and Conditions
Divisions: Faculties > Social Sciences > School of Economics
Depositing User: Adelina Gschwandtner
Date Deposited: 03 Oct 2017 14:43 UTC
Last Modified: 29 May 2019 19:37 UTC
Resource URI: https://kar.kent.ac.uk/id/eprint/63715 (The current URI for this page, for reference purposes)
Gschwandtner, Adelina: https://orcid.org/0000-0002-6952-1782
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