Mobilising the public to fight poverty using anti‐poverty labels in online food markets: Evidence from a real experimental auction

Abstract

AbstractIn an emerging economy like China where the domestic income inequality has dramatically increased between middle‐class urban consumers and poor rural farmers, food grown by poor farmers with poverty alleviation labels may receive price premiums from consumers with multiple incentives. To reveal consumers' willingness‐to‐pay (WTP) for anti‐poverty labelled food, we implement a non‐hypothetical Becker–DeGroot–Marschak auction online experiment for apples with real shoppers. Results show that consumers are willing to pay 3.66 RMB extra for each kilogram of apples with anti‐poverty labels, indicating the opportunities for using voluntary public food consumption to supplement the government's anti‐poverty responsibilities. Consumers who are more empathic, who believe that anti‐poverty products have higher quality, who have donated money within the past year, and who are not involve with anti‐poverty related production or selling processes are willing to pay more. Additionally, three different information treatments (a beneficiary description, an appreciation certificate and a government promotion document) were found to increase consumers' WTP for anti‐poverty products. Treatment effects are different among consumers with different demographic characters and perspectives about the anti‐poverty label. Lastly, anti‐poverty labels can attract consumers for trial purchase but are not sufficient to lead consumers to make repeat purchases.