Inequality aversion and consumer ethnocentrism: Food consumer preferences for payoff distributions to farm producers

Abstract

AbstractThere are few empirical explanations for consumer preferences for payoff distributions across the agri‐food value chain in terms of psychographic characteristics. In the context of product origin, we contribute to the literature with an incentivized experiment to estimate preferences for payoff distributions among Missouri beef consumers, Missouri beef producers, and non‐Missouri beef producers on the basis of inequality aversion and consumer ethnocentrism. According to the results, Missouri beef consumers not only have self‐regarding preferences but also other‐regarding preferences in case of payoff distributions, in particular toward Missouri beef producers. We explain such preferences from the perspective of consumer ethnocentrism. Specifically, Missouri beef consumers who have a higher degree of state‐level ethnocentrism also have a higher degree of aversion to inequalities among themselves and Missouri beef producers. Although few food consumers appear to be highly ethnocentric, there may exist potential to segment on the basis of state‐level ethnocentrism. Other implications and research directions are also discussed.