Chinese Consumers’ Willingness to Pay for Safety-certified Tomatoes: Evidence from Random nth-Price Auctions

Abstract

The food safety certification system in China has multiple levels including organic, green, and hazard-free certifications. This study assessed consumer preferences for tomatoes that carry these different labels. Data were collected from 286 randomly selected consumers in Shandong Province, China, using the random nth-price auction experiment. The authors used the multivariate probit (MVP) model to analyse the factors that influence consumer preferences for tomatoes that carry different certification labels. Results indicated that consumers’ willingness to pay (WTP) for tomatoes that carry the green or organic label was significantly higher than their WTP for conventional tomatoes (CTs). However, consumers’ WTP for tomatoes that carry a hazard-free label was slightly higher than their WTP for CTs. Results of the MVP model analysis demonstrated that consumers with different individual characteristics have heterogeneous preferences for food certification labels. Food safety consciousness has positive effects on consumers’ WTP. Environmental awareness can help promote consumers’ WTP for safe food, but the environmental benefits of green and organic certifications are not likely to undergo significant growth. This research is of value to academia and to policymakers and suppliers. Governments and manufacturers should consider consumer preferences for different certification labels in their strategy development to satisfy diverse market requirements.