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Impact of Nutritional Labeling on Consumer Buying Behavior

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  • Prathiraja, P.H.K.
  • Ariyawardana, A.

Abstract

Nutritional label plays an important role in providing the relevant nutrition information to consumers. Inclusion of a nutritional label on food items may be an important packaging decision for the Sri Lankan food processors. Hence, a study was conducted with a view of identifying the market for nutritional labeling and the factors that influence the consumer willingness-to-pay for nutritional labeling. Data were collected from a random sample of 90 consumers selected from three supermarkets - Dhanasiri, Cargill’s Food City and Royal Garden Mall - located in Kandy. Market for nutritional labeling were identified by exploring data and a logit method of analysis was performed to identify the factors that influence the willingness-to-pay for nutritional information on food items. A significantly greater proportion of individuals in the age category 36 to 50 years, individuals with tertiary education, individuals with special dietary status and households with less than four members were willing to pay more for the nutritional labels. Logit analysis showed that gender, level of education and special dietary status have a significant positive effect and the household size has a significant negative effect on the willingness to pay for nutrition information. Accordingly, it could be stated that incorporation of a nutritional panel in the package would enhance the demand for food products and it would be an appropriate strategic task for the local food processors.

Suggested Citation

  • Prathiraja, P.H.K. & Ariyawardana, A., 2003. "Impact of Nutritional Labeling on Consumer Buying Behavior," Sri Lankan Journal of Agricultural Economics, Sri Lanka Agricultural Economics Association (SAEA), vol. 5, pages 1-13.
    • Handle: RePEc:ags:saeasj:205934
    DOI: 10.22004/ag.econ.205934
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    References listed on IDEAS

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    1. Nayga, Rodolfo M., 1996. "Determinants of Consumers' Use of Nutritional Information on Food Packages," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 28(2), pages 303-312, December.
    2. Stigler, George J., 2011. "Economics of Information," Ekonomicheskaya Politika / Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 5, pages 35-49.
    3. Govindasamy, Ramu & Italia, John, 1999. "Evaluating Consumer Usage of Nutritional Labeling: The Influence of Socio-Economic Characteristics," P Series 36734, Rutgers University, Department of Agricultural, Food and Resource Economics.
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