Dr. Jonathan Bauchet, Associate Professor, Division of Consumer Science, Purdue University
Seminar Title: “Information and the trade-off between food safety and food security in rural markets: Experimental evidence from Malawi”
Abstract:
Unobservable food safety attributes can undermine consumer demand for quality, leading to a lemons market where unsafe food is prevalent. This is particularly true with limited resource consumers in developing countries, who have limited awareness of food safety and few options other than to buy what is available. Providing consumers with information about food safety and/or labels designating food quality can potentially reduce the problem. However, it is not clear how seasonal changes in food availability affect the way people value information about unobservable food quality. To inform this issue we estimate the extent to which quality (food safety) labels can increase consumers’ willingness to pay (WTP) for higher quality (safe) grain in rural markets of sub-Saharan Africa (SSA) in both the harvest season, when grain is plentiful and in the lean season when grain is scarce. We implemented a clustered randomized control trial (RCT) with 1,098 rural households in central Malawi to evaluate whether providing information about food safety increased respondents’ demand for safe groundnuts (peanuts), and whether the demand for quality varied depending on food availability across the year. We used Becker-DeGroote-Marshack auctions to elicit consumers’ willingness to pay (WTP) for three quality grades of groundnuts: (1) unsorted, where damaged kernels were mixed with undamaged kernels, and without a food safety information label; (2) visibly sorted with only undamaged kernels and without a food safety information label; and (3) visibly sorted with only undamaged kernels and with a food safety label. Results indicate that only informed consumers were willing to pay a premium for unobservable grain quality (WTP for grade 3 – WTP for grade 2). Uninformed consumers only placed a premium on observable quality (WTP for grade 2 – WTP for grade 1). However, the state of food availability/security altered this overall result. At harvest, when groundnut were abundant, both informed and uninformed consumers were willing pay the same premium – statistically – for unobservable quality. However, in the lean season, when grain was scarce, uninformed consumers were not willing to pay any premium for unobservable quality, possibly reflecting a belief that food quality during scarce times is low. Informed consumers, on the other hand, exhibited a higher unobservable quality premium in the leans season than they did at harvest. These results suggest that a food safety price premium alone may not solve the market’s failure to incentivize the production and sale of safer foods, particularly when food is scarce, and that outside interventions such as information provision are needed.
Wednesday, Mar 10, 2021
2:30pm – 3:30pm (EST)
*Link to Join*:
https://uconn-cmr.webex.com/uconn-cmr/j.php?MTID=m78bd84d80b3e0dc08f4e393fe3b2ec3a
Meeting number (access code): 120 890 4347
Meeting password: ytMJDKbp542
For more information, contact: Tatiana Andreyeva at tatiana.andreyeva@uconn.edu