Urban Vietnamese consumers’ preferences for attributes of sustainably produced rice

Abstract

PurposeThe purpose of the present research is to examine the comparative values that urban Vietnamese consumers place on attributes of rice that is produced using environmentally friendly methods. The authors consider the impacts that this may have on the livelihoods of rural Vietnamese small farmers. Rice is an “impure public good” that includes both “private” and “public” attributes that consumers consider in their purchase decisions. Consumers make tradeoffs between environmentally and socially beneficial practices (public goods) and perceptions of product quality (private goods). The authors used latent class modeling to investigate the values associated with attributes of rice that is produced using sustainable farming practices.Design/methodology/approachThe authors used a discrete choice experimental design in which consumers stated their choices among combinations of rice attributes. The survey provided responses from 360 urban Vietnamese consumers and allowed to estimate the preferences and nonpecuniary values for rice grown using different levels of environmentally beneficial production methods.FindingsThe results identify two segments of rice consumers: one group of consumers who are sensitive to price and the other group who are sensitive to environmental issues. The individual characteristics are reflected in the choices of production methods and in the willingness to pay for environmentally beneficial outcomes of those methods.Research limitations/implicationsGiven the number of independent variables measured, the sample was relatively small, such that confirmatory statistical methods were inconclusive. However, the authors used multiple analytical tools that provide corroboration of the significant determinants of the utility functions for the two segments.Practical implicationsThe results provide directions for production of rice at a national level, as well as practical implications for consumer-oriented communications.Social implicationsResults suggest that the emerging middle class of Vietnamese consumers are willing to pay more for rice that is produced using methods that are beneficial to the environment. Results also indicate challenges to provide sustainably-produced rice to poorer groups of consumers.Originality/valueThe study provides important context for consumer preferences within emerging economies. This also adds to a growing literature that uses the choice experiment method to estimate consumer valuation of the outcomes of various agricultural practices.