An analysis of the impacts of tasting experience and peer effects on consumers’ willingness to pay for novel foods

Abstract

AbstractThis paper investigates the impacts of tasting experience and observing peers’ taste preferences on consumers' willingness to pay (WTP) for novel insect‐based food products. In an empirical incentivized discrete choice experiment (DCE) developed to estimate Kenyan consumers' WTP for buns made with cricket flour, we test two treatments against a control treatment using a between‐subject design. The control treatment is a typical DCE questionnaire survey. Treatment 1 is identical to the control except that respondents are asked to taste the buns before answering the questionnaire. In Treatment 2, respondents are also given the tasting experience but they additionally observe their peers' taste preferences for the buns. The results suggest that tasting experience is important since Treatment 1 obtains significantly higher WTP estimates than the control. However, allowing additionally for peer effects in Treatment 2 significantly reduces the WTP estimates again countering the effect of tasting in Treatment 1. According to the results, this is partly related to the observation of peers reacting negatively in terms of disliking the bun products. [EconLit Citations: D12, D90, Q13].