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Consumers' Willingness to Pay for Bioplastic Plant Containers: An Experimental Auction Approach

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  • Ellison, Brenna
  • Kirwan, Barrett
  • Nepal, Atul

Abstract

This study elicites consumers' willingness to pay for an environmentally sustainable good that might not typically be purchased on its own. We isolate the value of these perfectly-complementary, auxiliary goods by endowing consumers with the complete good and giving them the opportunity to pay to upgrade the auxiliary component of the good. We employ a Becker-Degroot-Marschack auction design in a market setting to determine consumers' actual willingness to pay for the auxiliary good. We find consumers are willing to pay a $0.67--$1.12 premium for a bioplastic plant container over a traditional plastic one.

Suggested Citation

  • Ellison, Brenna & Kirwan, Barrett & Nepal, Atul, 2015. "Consumers' Willingness to Pay for Bioplastic Plant Containers: An Experimental Auction Approach," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205670, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea15:205670
    DOI: 10.22004/ag.econ.205670
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    File URL: https://ageconsearch.umn.edu/record/205670/files/Bioplastics.pdf
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    References listed on IDEAS

    as
    1. Lusk, Jayson L., 2003. "Using Experimental Auctions for Marketing Applications: A Discussion," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 35(2), pages 349-360, August.
    2. Ty Feldkamp & Ted C. Schroeder, 2004. "Experimental Auction Procedure: Impact on Valuation of Quality Differentiated Goods," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 86(2), pages 389-405.
    3. Lusk Jayson L & Alexander Corinne & Rousu Matthew C., 2007. "Designing Experimental Auctions for Marketing Research: The Effect of Values, Distributions, and Mechanisms on Incentives for Truthful Bidding," Review of Marketing Science, De Gruyter, vol. 5(1), pages 1-32, October.
    4. Lusk Jayson L & Alexander Corinne & Rousu Matthew C., 2007. "Designing Experimental Auctions for Marketing Research: The Effect of Values, Distributions, and Mechanisms on Incentives for Truthful Bidding," Review of Marketing Science, De Gruyter, vol. 5(1), pages 1-32, October.
    5. Corrigan, Jay R. & Rousu, Matthew C., 2008. "Testing Whether Field Auction Experiments Are Demand Revealing in Practice," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 33(2).
    6. repec:feb:framed:0078 is not listed on IDEAS
    7. repec:ken:wpaper:0804 is not listed on IDEAS
    8. Thrasher, James F. & Rousu, Matthew C. & Hammond, David & Navarro, Ashley & Corrigan, Jay R., 2011. "Estimating the impact of pictorial health warnings and "plain" cigarette packaging: Evidence from experimental auctions among adult smokers in the United States," Health Policy, Elsevier, vol. 102(1), pages 41-48, September.
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    Cited by:

    1. Arup Dey & Md Mahbubar Rahman & Anunay Gupta & Nita Yodo & Chiwon W. Lee, 2023. "A Performance Study on 3D-Printed Bioplastic Pots from Soybean By-Products," Sustainability, MDPI, vol. 15(13), pages 1-17, July.
    2. Ajayi, V. & Reiner, D., 2020. "Consumer Willingness to Pay for Reducing the Environmental Footprint of Green Plastics," Cambridge Working Papers in Economics 20110, Faculty of Economics, University of Cambridge.

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    Keywords

    Agribusiness; Demand and Price Analysis; Marketing; Research Methods/ Statistical Methods;
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