Information or prices, which is most powerful in increasing consumer demand for organic vegetables?
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Information or prices, which is most powerful in increasing consumer demand for organic vegetables? / Smed, Sinne; Andersen, Laura Mørch.
In: International Business Research, Vol. 5, No. 12, 2012, p. 175-194.Research output: Contribution to journal › Journal article › Research › peer-review
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TY - JOUR
T1 - Information or prices, which is most powerful in increasing consumer demand for organic vegetables?
AU - Smed, Sinne
AU - Andersen, Laura Mørch
PY - 2012
Y1 - 2012
N2 - Based on a unique and very detailed panel dataset covering consumption of organically and conventionally produced vegetables in the years 2005 - 2007, we examine the effects of information about positive health effects of consuming organic vegetables and information about negative health effects of consuming conventional vegetables on demand for organic foods for six different segments of Danish households. Three of these segments are positive towards organics whereas the remaining three segments are negative or indifferent. Using the double hurdle model we estimate partial effects of both directly and indirectly obtained information as well as prices. The results show, that there are larger effects of information for households where the information is in accordance with initial knowledge and attitudes, hence the positive segments react more to information whereas the negative segments react more to prices. “New” consumers can be persuaded to buy organic vegetables by providing information about the negative health effects of consuming conventional vegetables since it increases the probability of an organic purchase. Once consumers have entered the organic marked for vegetables, information that link health and the consumption of organic vegetables will increase consumption. The results are important for firms and producers who want to successfully target information to different consumer groups with the aim of increasing the market share for organic food.
AB - Based on a unique and very detailed panel dataset covering consumption of organically and conventionally produced vegetables in the years 2005 - 2007, we examine the effects of information about positive health effects of consuming organic vegetables and information about negative health effects of consuming conventional vegetables on demand for organic foods for six different segments of Danish households. Three of these segments are positive towards organics whereas the remaining three segments are negative or indifferent. Using the double hurdle model we estimate partial effects of both directly and indirectly obtained information as well as prices. The results show, that there are larger effects of information for households where the information is in accordance with initial knowledge and attitudes, hence the positive segments react more to information whereas the negative segments react more to prices. “New” consumers can be persuaded to buy organic vegetables by providing information about the negative health effects of consuming conventional vegetables since it increases the probability of an organic purchase. Once consumers have entered the organic marked for vegetables, information that link health and the consumption of organic vegetables will increase consumption. The results are important for firms and producers who want to successfully target information to different consumer groups with the aim of increasing the market share for organic food.
U2 - 10.5539/ibr.v5n12p175
DO - 10.5539/ibr.v5n12p175
M3 - Journal article
VL - 5
SP - 175
EP - 194
JO - International Business Research
JF - International Business Research
SN - 1913-9004
IS - 12
ER -
ID: 41918933