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Estimating Willingness to Pay Using a Polychotomous Choice Function: An Application to Pork Products with Environmental Attributes

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  • Hurley, Sean P.
  • Miller, Douglas J.
  • Kliebenstein, James B.

Abstract

Bid data from a Vickrey auction for pork chops with embedded environmental attributes were analyzed. It was found that approximately 62% of the participants had a positive WTP for the most "environmentally friendly" package of pork. Thirty percent of the participants had no WTP, and 8% had a negative WTP. A polychotomous choice model was used to accommodate data having an anchoring point within the distribution of the data. Standard variables found in the WTP literature coupled with this model were used to predict participants who were premium payers and non-premium payers using an estimated ordered probit equation.

Suggested Citation

  • Hurley, Sean P. & Miller, Douglas J. & Kliebenstein, James B., 2006. "Estimating Willingness to Pay Using a Polychotomous Choice Function: An Application to Pork Products with Environmental Attributes," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 31(2), pages 1-17, August.
    • Handle: RePEc:ags:jlaare:8618
    DOI: 10.22004/ag.econ.8618
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    References listed on IDEAS

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    1. Matthew C. Rousu & Wallace E. Huffman & Jason F. Shogren & Abebayehu Tegene, 2004. "Estimating the Public Value of Conflicting Information: The Case of Genetically Modified Foods," Land Economics, University of Wisconsin Press, vol. 80(1), pages 125-135.
    2. Abeles-Allison, Mark & Connor, Larry J., 1990. "An Analysis of Local Benefits and Costs of Michigan Hog Operations Experiencing Environmental Conflicts," Agricultural Economic Report Series 201396, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    3. Rousu, M. & Huffman, Wallace & Shogren, Jason F. & Tegene, Abebayehu, 2004. "Estimating the Public Value of Information: Genetically Modified Foods," Staff General Research Papers Archive 10426, Iowa State University, Department of Economics.
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    Cited by:

    1. White, Robin R. & Brady, Michael, 2014. "Can consumers’ willingness to pay incentivize adoption of environmental impact reducing technologies in meat animal production?," Food Policy, Elsevier, vol. 49(P1), pages 41-49.
    2. White, Robin R. & Brady, Michael & Capper, Judith L. & Johnson, Kristen A., 2014. "Optimizing diet and pasture management to improve sustainability of U.S. beef production," Agricultural Systems, Elsevier, vol. 130(C), pages 1-12.
    3. Kwideok Han & Jeffrey Vitale & Yong-Geon Lee & Inbae Ji, 2022. "Measuring the Economic Value of the Negative Externality of Livestock Malodor in South Korea," IJERPH, MDPI, vol. 19(15), pages 1-13, August.
    4. Tully, Stephanie M. & Winer, Russell S., 2014. "The Role of the Beneficiary in Willingness to Pay for Socially Responsible Products: A Meta-analysis," Journal of Retailing, Elsevier, vol. 90(2), pages 255-274.

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