124 Financial strain caused by COVID-19 and its impact on equine industry participant willingness-to-pay for equine care

Abstract

The novel COVID-19 virus caused a global pandemic disrupting lives, industries, and economies. The resulting financial strain impacted prices due to challenges with production and supply chain distribution. This study investigates the financial strain COVID-19 had on equine owners and leasers, what the market for equine care would bear if costs for care were to increase, and what factors contribute to willingness-to-pay (WTP) for increasing cost of equine care. An online survey was distributed for 4 weeks to adult US residents, where respondents reported their involvement in the equine industry, financial response to COVID-19, and responses to a double-bound dichotomous choice question pertaining to their WTP for care given a randomized increase (1–20%) in their current cost (n = 506). Data were analyzed using interval regression models where a = 0.05 (Stata15). Respondents were separated into 3 groups (owner keeping their horse at their residence, owner boarding their equids, and leaser) based on their equine ownership status and where their equine were kept. Boarders reported mean monthly payments of 23.33 ± 90.37 USD (n = 15) for free board, 236.47 ± 151.92 USD, (n = 75) for partial board, and 514.75 ± 291.71 USD (n = 181) for full board. Results show all owners, leaser, and boarders have different WTP values which range from 18.5% to 26.2% increase in current care costs which extends beyond the presented range due to many respondents responding “yes” to both WTP questions (71% of owners, 6% of boarders, 65% of leasers) and the use of mean values across the entire sample in predicting the WTP. Equine owners, with on farm equids from the southern US were WTP 11% less than from other regions ( P = 0.015). The current boarding fees from owners that board their equids lowered their WTP by 0.01% ( P = 0.029) for each additional dollar paid, whereas current care costs were not a significant factor for other owners ( P = 0.370) or leasers ( P = 0.395). Those that had a full lease for their equids, whether housed on farm or at a facility, were WTP 15% higher ( P = 0.036) than those that had a partial or no lease. In comparison, boarding status (full, partial, or no boarding) did not significantly ( P = 0.51) impact boarder's WTP. Age of respondent and annual household income heterogeneously affected WTP across all groups. These results indicate the market for equine care can bear the increases in cost associated with financial distress related to COVID-19. Results from this study should be taken in context of the global pandemic and the restrictions in place, or lack thereof, at the time the survey was administered.