Contingent valuation of consumers' willingness-to-pay for organic food in Argentina

Abstract

Throughout these last years, organic agriculture h as undergone a remarkable expansion due, among other things, to the greater interest shown by consumers aware of food safety concerns involving real or perceived quality risks (1). This paper aims to estimate consumers' willingness to pay (WTP) for organic food products available in the Argentinean domestic market, with a view to providing some useful insights to gain support and outline strategies for promotion o f organic production, marketing, regulation, and labelling pr ograms of organic food products. A Binomial Multiple Logistic Regression model is estimated with data from a food consumption survey conducted in Buenos Aires city, Argentina, in April 2005. The Contingent Valuation Method was chosen in order to calculate their WTP for five organic selected produ cts: Regular Milk, Leafy Vegetables, Whole Wheat Flour, Fresh Chicken and Aromatic Herbs. The empirical results reveal that consumers are wil ling to pay a premium for these products and that although prices play an important role, lack of store availability and of a reliable regulatory system to mitigate quality risks constra int consumption of organic products in this country.