Determinants of willingness-to-pay for GM rice with health benefits in a high-risk region: Evidence from experimental auctions for folate biofortified rice in China

Abstract

Provision of folate biofortified rice (FBR), a GM rice variant with higher folate content, has been recently proposed as an alternative health strategy to address folate deficiency and its main adverse outcomes, such as neural-tube defects. Based on experimental auctions with 251 women of childbearing age, split up between student (n=120) and non-student auctions (n=132), this study investigates the determinants of willingness-to-pay for this GM rice with health benefits in Shanxi Province, a high-risk region of China. The study shows that female Shanxi rice consumers are prepared to pay a premium of ¥ 1.73 or 33.7%, which corresponds with a switch to a rice variety that is one price/quality level higher than regular rice. Offering a GM-free folate substitute did not reveal significant differences in bidding behavior. Besides a significant target group effect, by which students are less likely to buy and pay more for FBR, willingness-to-pay is mainly determined by consumers’ GM food acceptance and objective knowledge. Despite lower bids after providing information about the GM technology, the perceived benefits seem to be high enough to compensate for potential negative reactions to GM food. Our findings lend support for the large potential of biofortified staple crops in high-risk regions, even if these involve GM technology.