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Are fair trade labels good business ? Ethics and coffee buying intentions

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  • P. DE PELSMACKER
  • L. DRIESEN
  • G. RAYP

Abstract

On the basis of a sample of 808 Belgian citizens and using conjoint analysis, the importance of a ‘fair trade’ label for the coffee buying decision is studied, as well as the willingness-to-pay for such a label. Furthermore, the size of the consumer segment willing to buy ‘fair trade’ coffee and their characteristics are studied. On average, a fair trade label is considered to be the second most important coffee attribute, together with flavor, and almost as important as the brand. Ten percent of the sample is willing to pay at least the actual price premium for fair trade coffee (27%). On the basis of the relative importance they attach to various coffee attributes, coffee buyers can be divided into four segments: fair trade lovers (11%), fair trade likers (40%), flavor lovers (24%) and brand lovers (25%). A number of demographic characteristics are measured, as well as the personal values of the respondents (Rokeach). Five basic dimensions of personal values can be distinguished: civic spirit, competence, sincere and social, idealistic, and personal gratification. Fair trade lovers are relatively highly educated, and the 31-44 years age group is over represented. They score higher than the other segments on personal values such as idealism, but lower on the dimension ‘civic spirit’. The characteristics of fair trade likers are not significantly different from the average in the sample, except for their higher degree of idealism.

Suggested Citation

  • P. De Pelsmacker & L. Driesen & G. Rayp, 2003. "Are fair trade labels good business ? Ethics and coffee buying intentions," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 03/165, Ghent University, Faculty of Economics and Business Administration.
    • Handle: RePEc:rug:rugwps:03/165
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    References listed on IDEAS

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    Cited by:

    1. Rode, Julian & Hogarth, Robin M. & Le Menestrel, Marc, 2008. "Ethical differentiation and market behavior: An experimental approach," Journal of Economic Behavior & Organization, Elsevier, vol. 66(2), pages 265-280, May.
    2. D. Van den Poel, 2003. "Predicting Mail-Order Repeat Buying. Which Variables Matter?," Review of Business and Economic Literature, KU Leuven, Faculty of Economics and Business (FEB), Review of Business and Economic Literature, vol. 0(3), pages 371-404.
    3. I. Vermeir & W. Verbeke, 2005. "Sustainable food consumption, involvement, certainty and values: an application of the theory of Planned Behaviour," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 05/352, Ghent University, Faculty of Economics and Business Administration.
    4. Leonardo Becchetti & Stefano Castriota, 2008. "Is Fair Trade Honey Sweeter? An empirical analysis on the effect of affiliation on productivity," Working Papers 104, ECINEQ, Society for the Study of Economic Inequality.
    5. Leonardo Becchetti & Giovanni Trovato, 2011. "Corporate social responsibility and firm efficiency: a latent class stochastic frontier analysis," Journal of Productivity Analysis, Springer, vol. 36(3), pages 231-246, December.
    6. Mann, Stefan, 2008. "Analysing fair trade in economic terms," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 37(5), pages 2034-2042, October.
    7. Leonardo Becchetti & Stefano Castriota & Melania Michetti, 2013. "The effect of fair trade affiliation on child schooling: evidence from a sample of Chilean honey producers," Applied Economics, Taylor & Francis Journals, vol. 45(25), pages 3552-3563, September.
    8. Laiza Andriolo da Rocha Ramos & Francesco Zecca & Claudio Del Regno, 2022. "Needs of Sustainable Food Consumption in the Pandemic Era: First Results of Case Study," Sustainability, MDPI, vol. 14(16), pages 1-23, August.
    9. Leonardo Becchetti & Furio Camillo Rosati, 2007. "Global Social Preferences and the Demand for Socially Responsible Products: Empirical Evidence from a Pilot Study on Fair Trade Consumers," The World Economy, Wiley Blackwell, vol. 30(5), pages 807-836, May.
    10. Shahnaj Akter & Shahjahan Ali & Mária Fekete-Farkas & Csaba Fogarassy & Zoltán Lakner, 2023. "Why Organic Food? Factors Influence the Organic Food Purchase Intension in an Emerging Country (Study from Northern Part of Bangladesh)," Resources, MDPI, vol. 12(1), pages 1-19, January.
    11. Jean-Marie Codron & Lucie Siriex & Thomas Reardon, 2006. "Social and environmental attributes of food products in an emerging mass market: Challenges of signaling and consumer perception, with European illustrations," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 23(3), pages 283-297, October.
    12. Hussain, Safdar & Ahmed, Wasim & Rabnawaz, Ambar & Jafar, Rana Muhammad Sohail & Saqib, Zulkaif Ahmed & Ullah, Sana & JianZhou, Yang, 2016. "Client Intentions and Buying Behavior with Regard of Dairy Products-Review," MPRA Paper 70383, University Library of Munich, Germany.
    13. Muhammed Abdullah Sharaf & Selvan Perumal, 2018. "How Does Green Products? Price and Availability Impact Malaysians? Green Purchasing Behavior?," The Journal of Social Sciences Research, Academic Research Publishing Group, vol. 4(3), pages 28-34, 03-2018.
    14. Gargi Bhaduri & Jihyun Kim-Vick & Madeline Blanken, 2023. "Millennial Heterosexual Couples’ Sustainable Consumption Choices: An Exploratory Study into Decision-Making," Sustainability, MDPI, vol. 16(1), pages 1-18, December.
    15. Shahjahan Ali & Shahnaj Akter & Csaba Fogarassy, 2021. "Analysis of Circular Thinking in Consumer Purchase Intention to Buy Sustainable Waste-To-Value (WTV) Foods," Sustainability, MDPI, vol. 13(10), pages 1-14, May.
    16. Kumju Hwang & Hyewon Kim, 2018. "Are Ethical Consumers Happy? Effects of Ethical Consumers' Motivations Based on Empathy Versus Self-orientation on Their Happiness," Journal of Business Ethics, Springer, vol. 151(2), pages 579-598, August.
    17. Vermeir, Iris & Verbeke, Wim, 2008. "Sustainable food consumption among young adults in Belgium: Theory of planned behaviour and the role of confidence and values," Ecological Economics, Elsevier, vol. 64(3), pages 542-553, January.
    18. Leonardo Becchetti & Furio Camillo Rosati, 2005. "The demand for socially responsible products: empirical evidence from a pilot study on fair trade consumers," Working Papers 04, ECINEQ, Society for the Study of Economic Inequality.
    19. I. Vermeir & W. Verbeke, 2004. "Sustainable Food Consumption: Exploring The Consumer Attitude – Behaviour Gap," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 04/268, Ghent University, Faculty of Economics and Business Administration.

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    Keywords

    fair trade; coffee buying behavior; ethical production; ethical consumption; personal values; conjoint analysis;
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