Evaluating Consumer Usage of Nutritional Labeling: The Influence of Socio-Economic Characteristics

The majority of consumers report making frequent use of nutritional labeling when purchasing food products. However, certain segments appear to place a greater emphasis on food product labels than others. This study empirically evaluates which demographic characteristics encourage consumers to be more likely to take nutritional labels into account when purchasing grocery products. The results indicate that females, older individuals, and those living in suburban and rural areas are the most likely to make use of nutritional labeling. The results also indicate that larger households were less likely to use nutritional labeling.Food Consumption/Nutrition/Food Safety,

The Influence of Socio-Economic Characteristics on Food Advertisement Usage

Only 22 percent of surveyed consumers reported making frequent use of food advertisements when purchasing food products. However, certain demographic segments appear to place a greater emphasis on food advertisements than others. This study empirically evaluates which socio-economic characteristics encourage consumers to be more likely to take food advertisements into account when purchasing grocery products. The results indicate that those with lower annual incomes, those with lower levels of education, and those living in suburban and rural areas are the most likely to make use of food advertisements in the newspaper. The results also indicate that households with children, single individuals, and those over 65 years of age are less likely to use food advertisements.Consumer/Household Economics, Marketing,

PREDICTING WILLINGNESS-TO-PAY A PREMIUM FOR ORGANICALLY GROWN FRESH PRODUCE

Consumers were surveyed at various grocery retail establishments in New Jersey to provide opinions on organic produce. The objective of this study was to empirically evaluate which demographic characteristics cause consumers to be more likely to pay a premium to obtain organically grown produce. The results indicate that females, those with higher annual incomes, younger individuals, and those who usually or always purchase organic produce are all more likely to pay a premium for organic produce. The results also indicate that the likelihood of paying a premium for organic produce decreases with the number of individuals living in the household.Consumer/Household Economics,

SUPPLY RESPONSE IN THE NORTHEASTERN FRESH TOMATO MARKET: COINTEGRATION AND ERROR CORRECTION ANALYSIS

This paper reexamines supply response in the Northeastern fresh tomato market during the 1949-94 period by employing cointegration and error correction technique. It tests whether there has been a long-run equilibrium relationship between Northeastern production and a set of price and nonprice factors that influence it. Findings suggest that wage rate, imports from competing regions, and urban pressure have had significant negative impacts on regional production. The negative relationship between price and production may have resulted from the strong negative effects exerted by the nonprice factors.Demand and Price Analysis,

Consumer Response to Integrated Pest Management and Organic Agriculture: An Econometric Analysis

While several studies have presented aggregate, descriptive illustrations of consumer response to IPM, the willingness-to-purchase and willingness-to-pay for IPM produce as a function of demographic characteristics has not received the exhaustive research attention that has focused on organic produce. The objective of this study was to empirically evaluate which demographic characteristics cause consumers to be more likely to purchase IPM grown produce. A hypothetical willingness-to-purchase model for IPM produce as well as willingness-to-pay models for both IPM and organic produce are presented. A non-hypothetical analysis also predicts consumers who strictly purchase only conventional produce. Income was found to be the most significant determinant of willingness-to-purchase IPM grown produce. Participants with higher annual incomes were more likely to express an interest in purchasing IPM produce and also appeared less likely to strictly purchase conventional produce. Those whose frequently purchase organic produce, those who visit farmers markets and those who live in suburban areas were all found to be more likely to purchase IPM grown produce. The results also indicate that females, those with higher annual incomes, younger individuals, and those who frequently purchase organic produce are all more likely to pay a premium for both IPM and organically grown produce. Overall, the results of this survey give insight into the likely consumer response to produce that is labeled as “IPM Grown.” However, before the average consumer exhibits the same level of interest in IPM as the sample in this study, some mechanism must be developed to educate the public about IPM.Consumer/Household Economics, Crop Production/Industries, Farm Management,

Environmental pollution control under alternative incentive structures

The present study examines environmental pollution control under alternative incentive structures with an emphasis on the effectiveness and practicality of alternative policy tools. The focus is on three instruments for controlling pollution: (1) Environmental Bonds; (2) Budget Balancing Incentive Mechanisms; and (3) Environmental Rank Order Tournaments;Environmental bonds typically require more information for implementation than either budget balancing incentive mechanisms or rank order tournaments. However, there is a trade-off between the cost savings from acquiring information and the potential costs from committing an error in assigning pollution control responsibility;Paper I examines the limits to environmental bonds. It identifies three major limitations to environmental bonds: (1) government moral hazard; (2) liquidity constraints; and (3) legal restrictions. Liquidity constraints are a major factor in reducing the attractiveness of applying environmental bonds to the agricultural sector;An additional limitation associated with environmental bonds is that it requires monitoring of individual firms. Xepapadeas (1991) introduced a budget balancing incentive scheme for risk neutral firms, combining subsidies and a random penalty. Paper II shows that, contrary to Xepapadeas, risk aversion is a necessary condition to attain compliance. Using Holmstrom (1982) and Rasmusen (1987), the paper proves that the compliance can be achieved only if the firms are sufficiently risk averse. It also shows that the compliance with the social objectives can be improved by shifting the probability of detection and the fine from a high risk averse firm to a low risk averse firm. The paper also shows that the increase in number of firms has a negative effect on compliance;The problem with the random penalty mechanism is that the firm which is in compliance with optimal pollution abatement objectives, set by the regulator, may still get penalized when the ambient concentration exceeds the optimal level. Rank order tournament is an alternative budget balancing incentive mechanism that induces optimal pollution control effort through tournament among the firms and provides solutions to both complete monitoring and random penalization problems. It is shown that in case of risk neutral firms, rank order tournament can be designed to yield the same efficiency conditions as that of Pigouvian tax when the relation between effort and abatement is nonlinear

THE FEASIBILITY OF POULTRY LITTER TRANSPORTATION FROM ENVIRONMENTALLY SENSITIVE AREAS TO DELTA ROW CROP PRODUCTION

Arkansas ranks first in broiler production in the USA with more than a billion broiler and 1.5 million tons of litter produced in 1993. Transporting litter from western to eastern Arkansas can accomplish two goals: 1) avoid potential threat to clean water in western Arkansas and 2) can increase productivity of graded lands in the Delta. This paper examines the feasibility of litter transport from areas of high poultry concentrations to the Delta for use as a soil amendment. We establish the conditions for economical litter transport from source to destinations and determine the optimal rates of litter applications. The results suggest that it is economical to transport significant portions of litter.Livestock Production/Industries,

IMPLICATIONS OF POLICY REGULATIONS ON LAND APPLICATIONS OF POULTRY LITTER

The growth of the poultry industry in Arkansas has exploded in the past decade. As a result, approximately 1.5 million tons of litter are produced every year. Concerns about possible contamination of ground and surface water from land applications of poultry litter have been raised. This paper compares four policy scenarios in terms of their efficiency and practicality to manage land applications of poultry litter. The results indicate that a litter tax per ton of litter applied could achieve the same level of litter control as that of a land tax on litter applications, but at a lower tax rate.Agricultural and Food Policy,

Consumer Willingness to Pay for GM Food Benefits: Pay-off or Empty Promise? Implications for the Food Industry

Consumer/Household Economics, Food Consumption/Nutrition/Food Safety,

Quality of Agricultural Produce: Consumer Preferences and Perceptions

The purpose of this research was to gain a greater insight into the characteristics and beliefs consumers draw upon while selecting the produce they purchase. Health and environmental risk perceptions of many agricultural inputs and products were also collected as well as demographic information. Nineteen produce characteristics were ranked by consumers. Locally grown produce and the country of origin were among the least important characteristics while freshness, taste/flavor, cleanliness, health value and absence of pesticides were among the most important characteristics. The survey also showed that most consumers made use of nutritional information and labeling while shopping for food and those who did, felt it aided them in making better purchase decisions. Consumers exhibited a clear preference for low-input methods of agricultural production which minimize the use of pesticides. They believed that there were health benefits to organic produce and that they would purchase more organic produce if it were more readily available. Respondents also indicated that they believed pesticides in general, herbicides, fungicides and insecticides all had significant health and environmental risks. Consumers believed on average that the use of pesticides positively contributes to the cosmetic appearance, quality, and supply of produce. Conversely, they believed that a reduction in pesticide usage would increase both the healthfulness and prices of produce. The results show where consensus and discord exist among consumers beliefs. Issues which have been the result of media campaigns and advertising such as oils used in cooking, tobacco products and alcoholic beverages show a greater degree of consensus than issues which are not often in the public spotlight. There were also areas in which consumers believed that there were inadequacies in the current produce market. Participants did not believe government food safeguards were sufficient to 2 protect public health nor did they believe the experts know enough about the long term effects of pesticide residues. The goal of this research was to provide food marketing agents with a better understanding of consumer purchase behavior, preferences and beliefs. The results are especially encouraging to those developing marketing endeavors for low input produce such as organic and IPM produce.Consumer/Household Economics,