Irrational reputational damage on wakame seaweed in Sanriku district after the Fukushima nuclear disaster: revealed preference by auction experiment

Abstract

This study investigated the Japanese consumer's willingness to pay for wakame seaweed produced along the Sanriku coastal area located north of Fukushima, which suffered irrational reputational damage owing to concerns about radioactive contamination of seafood after the 2011 disaster at the Fukushima Daiichi nuclear power plant. An auction experiment was conducted with and without information treatment on both literal and visual information on radioactive contamination for the purpose of reducing irrational reputational damage. The results show no statistically significant premium on willingness to pay for wakame when the information on radioactive contamination was provided. However, an information effect is revealed in terms of the change in purchasing decision, from no-purchase to purchase. Hence, counterpropaganda against the irrational reputational damage of radioactive contamination is effective not for price but for purchasing decisions. The information turned out to be ineffective for consumer preference possibly because a basis price under consumer preference blocks effective promotion.