Consumer Valuation of and Attitudes towards Novel Foods Produced with New Plant Engineering Techniques: A Review

We follow the PRISMA extension for scoping reviews to review the emerging international body of empirical evidence on consumers’ attitudes and willingness to pay (WTP) for novel foods produced with New Plant Engineering Techniques (NPETs). NPETs include genome/gene editing, cisgenesis, intragenesis, and RNA interference. These novel foods are often beneficial for the environment and human health and more sustainable under increasingly prevalent climate extremes. These techniques can also improve animal welfare and disease resistance when applied to animals. Despite these abilities of NPETs, evidence suggests that many, but not all, consumers discount these novel foods relative to conventional ones. Our review sorts out findings to identify conditioning factors that can increase the acceptance of and WTP for these novel foods in a significant segment of consumers. International patterns of acceptance are identified. We also analyze how information and knowledge interact with consumer acceptance of these novel foods and technologies. Heterogeneity of consumers—across cultures and borders and in attitudes towards science and innovation—emerges as a key determinant of acceptance and WTP. Acceptance and WTP tend to increase when socially beneficial attributes—as opposed to producer-oriented cost-saving attributes—are generated by NPETs. NPET-improved foods are systematically less discounted than transgenic foods. Most of the valuation estimates are based on hypothetical experiments and surveys and await validation through revealed preferences in actual purchases in food retailing environments.

Consumer Valuation of and Attitudes Towards Novel Foods Produced with NPETs: A Review

We review the emerging international body of evidence on attitudes and willingness to pay (WTP) for novel foods produced with New Plant Engineering Techniques (NPETs). NPETs include genome/gene editing, cisgenesis, intragenesis, RNA interference and others. These novel foods are often beneficial for the environment and human health and more sustainable under increasingly prevalent climate extremes. These techniques can also improve animal welfare and disease resistance when applied to animals. Despite these promising attributes, evidence suggests that many, but not all consumers, discount these novel foods relative to conventional ones. Our systematic review sorts out findings to identify conditioning factors which can increase the acceptance of and WTP for these novel foods in a significant segment of consumers. International patterns of acceptance are identified. We also analyze how information and knowledge interact with consumer acceptance of these novel foods and technologies. Heterogeneity of consumers across cultures and borders, and in attitudes towards science and innovation emerges as key determinants of acceptance and WTP. Acceptance and WTP tend to increase when beneficial attributes—as opposed to producer-oriented cost-saving attributes—are generated by NPETs. NPETs improved foods are systematically less discounted than transgenic foods. Most of the valuation elicitations are based on hypothetical experiments and surveys and await validation through revealed preferences in actual purchases in food retailing environments.

Perceived subjective versus objective knowledge: Consumer valuation of genetically modified certification on food producing plants

Previous research has identified subjective and objective knowledge as determinants of consumers’ acceptance of genetically modified organisms (GMO) in the medical and food industries. In contrast to a large body of literature on the effects of attitudes or knowledge on food preferences, the extent to which consumers’ knowledge affects their valuation of non-GMO food producing plants (i.e., plants grown for food or ornamental purposes) is less understood. This manuscript investigates the relationship between consumers’ knowledge of relevant non-GMO certification programs and their acceptance and willingness-to-pay (WTP) for non-GMO plants. The first study used an Internet respondent panel and choice experiment, while the second study utilized an in-person experimental auction. In line with previously reported low public acceptance of genetically modified food products, respondents were receptive of and willing to pay premiums for non-GMO food producing plants. This study found that subjective and objective knowledge impacted the premiums for non-GMO labels, with the high subjective and low objective knowledge group generating the highest WTP. Low subjective and low objective knowledge resulted in the lowest WTP. Findings suggest a disconnect between subjective and objective knowledge of non-GMO certification programs, which in turn influences consumer valuation of those products.

Consumer Myopia in Vehicle Purchases: Evidence from a Natural Experiment

A central question in the analysis of fuel economy policy is whether consumers are myopic with regards to future fuel costs. We provide the first evidence on the consumer valuation of fuel economy from a natural experiment that provides exogenous variation in fuel economy ratings. We examine the short-run equilibrium effects of a restatement of fuel economy ratings that affected 1.6 million vehicles. Using the implied changes in willingness to pay, we find that consumers act myopically: consumers are indifferent between $1.00 in discounted fuel costs and $0. 16–0.39 in the purchase price when discounting at 4 percent. This undervaluation persists under a wide range of assumptions. (JEL D12, L62, L71, L11)

Pricing and Return Policies in a Competitive Market: A Consumer-Valuation Based Analysis with Valuation Uncertainties

In this study, we develop a series of consumer-valuation-based models to investigate the pricing and return policies of the sellers in a competitive e-commerce market. Differing from the competition models in literature, a novel two-dimensional valuation structure is built, which considers the valuations of a consumer on two products and the valuation differentiation of all consumers on each product. We consider both monopoly and duopoly (competitive) markets. In each market, two models are respectively developed, one with and one without the return policies. We derive the solutions for the four models, and conduct some analytical and numerical investigations. The results show that return policy with a partial refund is always chosen by the sellers in both monopoly and duopoly markets. Return policy benefits the seller in a monopoly market, but may not benefit the sellers in a duopoly market. In the duopoly models, one seller can be considered as a monopoly seller who meets a new competitor. Our results show that the monopoly seller will reduce its price by no more than 20% when there comes a competitor, and, counter-intuitively, it will meanwhile adopt a severer return policy to the consumers.

Hedonic Pricing of Rice Attributes, Market Sorting, and Gains from Quality Improvement in the Beninese Market

Latent class analysis is applied to a hedonic price model to examine the presence of heterogeneity in consumer valuation of quality attributes in the Beninese rice market. Three classes of consumers are found in proportions of 5, 56, and 39 percent. We employ a partial equilibrium model and find modest gains in consumer surplus from an increase in head rice and reduction in chalkiness. The results provide evidence of market sorting, which should be taken into consideration in upgrading rice value chains. Also, it is important to assess potential gains from quality improvement to determine priorities for research and development.