IDEAS home Printed from https://ideas.repec.org/p/zbw/daredp/1803.html
   My bibliography  Save this paper

E-commerce in agriculture: The case of crop protection product purchases in a discrete choice experiment

Author

Listed:
  • Fecke, Wilm
  • Danne, Michael
  • Mußhoff, Oliver

Abstract

The internet is playing an increasing role in the development of rural areas. For farmers in particular, reliable internet access creates opportunities concerning farm management decisions. Hence, the goal of this study was to investigate German farmers' willingness to buy inputs online. Primary data was collected by conducting a discrete choice experiment about the purchase of crop protection products. Selection decisions of 165 arable farmers were analyzed by a generalized multinomial logit model (GMNL) resulting in willingness to accept (WTA) space estimation. WTA estimates show that farmers are willing to switch to an online merchant if they are offered a significantly lower price. However, word-of-mouth-reputation and consultation offered via traditional media do not influence farmers' WTA for an online merchant. In contrast, delivery time significantly affects farmers' WTA for inputs purchased online. We also show that farmers' risk attitudes, prior online shopping experiences, and education are influential factors for the WTA for an online merchant. Surprisingly, age and farm size do not impact farmers' WTA. Since e-commerce has not been widely established in agriculture yet, these results are of great practical importance. The findings of this study give online merchants of agricultural inputs a first orientation for choosing appropriate marketing measures. Moreover, results are interesting for education policy.

Suggested Citation

  • Fecke, Wilm & Danne, Michael & Mußhoff, Oliver, 2018. "E-commerce in agriculture: The case of crop protection product purchases in a discrete choice experiment," DARE Discussion Papers 1803, Georg-August University of Göttingen, Department of Agricultural Economics and Rural Development (DARE).
    • Handle: RePEc:zbw:daredp:1803
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/178661/1/1019879181.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Scarpa, Riccardo & Willis, Ken, 2010. "Willingness-to-pay for renewable energy: Primary and discretionary choice of British households' for micro-generation technologies," Energy Economics, Elsevier, vol. 32(1), pages 129-136, January.
    2. Smith, Aaron D. & Goe, W. Richard & Kemey, Martin & Morrison Paul, Catherine J., 2004. "Computer and Internet Use by Great Plains Farmers," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 29(3), pages 1-20, December.
    3. Huffman, Wallace E & Mercier, Stephanie, 1991. "Joint Adoption of Microcomputer Technologies: An Analysis of Farmers' Decisions," The Review of Economics and Statistics, MIT Press, vol. 73(3), pages 541-546, August.
    4. Foster, Andrew D & Rosenzweig, Mark R, 1995. "Learning by Doing and Learning from Others: Human Capital and Technical Change in Agriculture," Journal of Political Economy, University of Chicago Press, vol. 103(6), pages 1176-1209, December.
    5. Thomas Dohmen & Armin Falk & David Huffman & Uwe Sunde & Jürgen Schupp & Gert G. Wagner, 2011. "Individual Risk Attitudes: Measurement, Determinants, And Behavioral Consequences," Journal of the European Economic Association, European Economic Association, vol. 9(3), pages 522-550, June.
    6. Jason Henderson & Frank Dooley & Jay Akridge, 2004. "Internet and E-Commerce Adoption by Agricultural Input Firms," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 26(4), pages 505-520.
    7. Schneider, Thea & Hartmann, Laura & Spiller, Achim, 2015. "Luxusmarketing bei Lebensmitteln: Eine empirische Studie zu Dimensionen des Luxuskonsums in Deutschland," DARE Discussion Papers 1502, Georg-August University of Göttingen, Department of Agricultural Economics and Rural Development (DARE).
    8. List John A. & Sinha Paramita & Taylor Michael H., 2006. "Using Choice Experiments to Value Non-Market Goods and Services: Evidence from Field Experiments," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 6(2), pages 1-39, January.
    9. John M. Rose & Lorenzo Masiero, 2010. "A comparison of prospect theory in WTP and preference space," Quaderni della facoltà di Scienze economiche dell'Università di Lugano 1006, USI Università della Svizzera italiana.
    10. Rolf A.E. Mueller, 2001. "E-Commerce and Entrepreneurship in Agricultural Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(5), pages 1243-1249.
    11. Doluschitz, Reiner, 2002. "Electronic Business in der Agrar– und Ernährungswirtschaft – Ernüchterung und Konsolidierung lösen die anfängliche Euphorie ab," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 51(02), pages 1-2.
    12. Jochen Meyer & Stephan von Cramon‐Taubadel, 2004. "Asymmetric Price Transmission: A Survey," Journal of Agricultural Economics, Wiley Blackwell, vol. 55(3), pages 581-611, November.
    13. Mishra, Ashok K. & Williams, Robert P. & Detre, Joshua D., 2009. "Internet Access and Internet Purchasing Patterns of Farm Households," Agricultural and Resource Economics Review, Cambridge University Press, vol. 38(2), pages 240-257, October.
    14. Daniel S. Putler & David Zilberman, 1988. "Computer Use in Agriculture: Evidence from Tulare County, California," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 70(4), pages 790-802.
    15. David A. Hensher & William H. Greene, 2011. "Valuation of Travel Time Savings in WTP and Preference Space in the Presence of Taste and Scale Heterogeneity," Journal of Transport Economics and Policy, University of Bath, vol. 45(3), pages 505-525, September.
    16. Heß, Sebastian & Bergmann, Holger & Sudmann, Lüder, 2006. "Die Förderung alternativer Energien - eine kritische Bestandsaufnahme," 54th Annual Conference, Goettingen, Germany, September 17-19, 2014 187446, German Association of Agricultural Economists (GEWISOLA).
    17. Ho, William & Xu, Xiaowei & Dey, Prasanta K., 2010. "Multi-criteria decision making approaches for supplier evaluation and selection: A literature review," European Journal of Operational Research, Elsevier, vol. 202(1), pages 16-24, April.
    18. Batte, Marvin T. & Ernst, Stanley C., 2007. "Net Gains from 'Net Purchases? Farmers' Preferences for Online and Local Input Purchases," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 36(1), pages 1-11, April.
    19. Hung‐Hao Chang & David R. Just, 2009. "Internet Access and Farm Household Income – Empirical Evidence using a Semi‐parametric Assessment in Taiwan," Journal of Agricultural Economics, Wiley Blackwell, vol. 60(2), pages 348-366, June.
    20. Leroux, Nicole & Wortman, Max S., Jr. & Mathias, Eric D., 2001. "Dominant Factors Impacting The Development Of Business-To-Business (B2b) E-Commerce In Agriculture," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 4(2), pages 1-14.
    21. Riccardo Scarpa & Mara Thiene & Kenneth Train, 2008. "Utility in Willingness to Pay Space: A Tool to Address Confounding Random Scale Effects in Destination Choice to the Alps," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 90(4), pages 994-1010.
    22. Marvin T. Batte & Eugene Jones & Gary D. Schnitkey, 1990. "Computer Use by Ohio Commercial Farmers," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 72(4), pages 935-945.
    23. Farag, Sendy & Schwanen, Tim & Dijst, Martin & Faber, Jan, 2007. "Shopping online and/or in-store? A structural equation model of the relationships between e-shopping and in-store shopping," Transportation Research Part A: Policy and Practice, Elsevier, vol. 41(2), pages 125-141, February.
    24. Mußhoff, Oliver & Tegtmeier, André & Hirschauer, Norbert, 2012. "Attraktivität einer landwirtschaftlichen Tätigkeit: Einflussfaktoren und Gestaltungsmöglichkeiten," DARE Discussion Papers 1213, Georg-August University of Göttingen, Department of Agricultural Economics and Rural Development (DARE).
    25. Teo, Thompson S.H. & Yu, Yuanyou, 2005. "Online buying behavior: a transaction cost economics perspective," Omega, Elsevier, vol. 33(5), pages 451-465, October.
    26. Latacz-Lohmann, Uwe & Schulz, Norbert & Breustedt, Gunnar, 2014. "Assessing Farmers' Willingness to Accept "Greening": Insights from a Discrete Choice Experiment in Gremany," 88th Annual Conference, April 9-11, 2014, AgroParisTech, Paris, France 170560, Agricultural Economics Society.
    27. Louviere,Jordan J. & Hensher,David A. & Swait,Joffre D., 2000. "Stated Choice Methods," Cambridge Books, Cambridge University Press, number 9780521788304, January.
    28. Balogh, Péter & Békési, Dániel & Gorton, Matthew & Popp, József & Lengyel, Péter, 2016. "Consumer willingness to pay for traditional food products," Food Policy, Elsevier, vol. 61(C), pages 176-184.
    29. Scarpa, R. & Thiene, M. & Train, K., 2008. "Appendix to Utility in WTP space: a tool to address confounding random scale effects in destination choice to the Alps," American Journal of Agricultural Economics APPENDICES, Agricultural and Applied Economics Association, vol. 90(4), pages 1-9, January.
    30. Norbert Schulz & Gunnar Breustedt & Uwe Latacz-Lohmann, 2014. "Assessing Farmers' Willingness to Accept “Greening”: Insights from a Discrete Choice Experiment in Germany," Journal of Agricultural Economics, Wiley Blackwell, vol. 65(1), pages 26-48, January.
    31. Briggeman, Brian C. & Whitacre, Brian E., 2008. "Farming and the Internet: Factors Affecting Input Purchases Online and Reasons for Non-Adoption," 2008 Annual Meeting, February 2-6, 2008, Dallas, Texas 6871, Southern Agricultural Economics Association.
    32. Caruana, Albert & Ewing, Michael T., 2010. "How corporate reputation, quality, and value influence online loyalty," Journal of Business Research, Elsevier, vol. 63(9-10), pages 1103-1110, September.
    33. Denzil G. Fiebig & Michael P. Keane & Jordan Louviere & Nada Wasi, 2010. "The Generalized Multinomial Logit Model: Accounting for Scale and Coefficient Heterogeneity," Marketing Science, INFORMS, vol. 29(3), pages 393-421, 05-06.
    34. Christensen, Tove & Pedersen, Anders Branth & Nielsen, Helle Oersted & Mørkbak, Morten Raun & Hasler, Berit & Denver, Sigrid, 2011. "Determinants of farmers' willingness to participate in subsidy schemes for pesticide-free buffer zones--A choice experiment study," Ecological Economics, Elsevier, vol. 70(8), pages 1558-1564, June.
    35. Gloy, Brent A. & Akridge, Jay T., 2000. "Computer And Internet Adoption On Large U.S. Farms," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 3(3), pages 1-16.
    36. Mishra, Ashok K. & Park, Timothy A., 2005. "An Empirical Analysis of Internet Use by U.S. Farmers," Agricultural and Resource Economics Review, Cambridge University Press, vol. 34(2), pages 253-264, October.
    37. Amponsah, William A., 1995. "Computer Adoption And Use Of Information Services By North Carolina Commercial Farmers," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 27(2), pages 1-12, December.
    38. Amponsah, William A., 1995. "Computer Adoption and Use of Information Services by North Carolina Commercial Farmers," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 27(2), pages 565-576, December.
    39. William Greene & David Hensher, 2010. "Does scale heterogeneity across individuals matter? An empirical assessment of alternative logit models," Transportation, Springer, vol. 37(3), pages 413-428, May.
    40. Busse, Stefan & Brümmer, Bernard & Ihle, Rico, 2010. "Interdependencies between fossil fuel and renewable energy markets: the German biodiesel market," DARE Discussion Papers 1010, Georg-August University of Göttingen, Department of Agricultural Economics and Rural Development (DARE).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Tajana Čop & Mario Njavro, 2022. "Application of Discrete Choice Experiment in Agricultural Risk Management: A Review," Sustainability, MDPI, vol. 14(17), pages 1-17, August.
    2. Elisa Giampietri & Samuele Trestini, 2020. "Analysing farmers' intention to adopt web marketing under a technology-organisation-environment perspective: A case study in Italy," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 66(5), pages 226-233.
    3. Spahn, Laurin & Höhler, Julia, 2021. "Farm supply and grain elevator businesses in a changing business environment: A mixed methods investigation of past and future strategies," 61st Annual Conference, Berlin, Germany, September 22-24, 2021 317047, German Association of Agricultural Economists (GEWISOLA).
    4. Alba Vázquez-López & Martín Barrasa-Rioja & Manuel Marey-Perez, 2021. "ICT in Rural Areas from the Perspective of Dairy Farming: A Systematic Review," Future Internet, MDPI, vol. 13(4), pages 1-18, April.
    5. Lydia Chikumbi & Milan Scasny, "undated". "Does ‘price framing’ influence empirical estimates in Discrete Choice Experiments: The case study for the South African wine industry," Working Papers 878, Economic Research Southern Africa.
    6. Ana Ramalho Ribeiro & Billy Goodburn & Luis Mayor & Line F. Lindner & Christoph F. Knöbl & Jacques Trienekens & Daniel Rossi & Francesca Sanna & Remigio Berruto & Patrizia Busato, 2023. "Skill Needs for Sustainable Agri-Food and Forestry Sectors (II): Insights of a European Survey," Sustainability, MDPI, vol. 15(5), pages 1-22, February.
    7. Xiaojing Li & Apurbo Sarkar & Xianli Xia & Waqar Hussain Memon, 2021. "Village Environment, Capital Endowment, and Farmers’ Participation in E-Commerce Sales Behavior: A Demand Observable Bivariate Probit Model Approach," Agriculture, MDPI, vol. 11(9), pages 1-20, September.
    8. Shupeng Huang & Hong Cheng & Manyi Tan & Zhiqing Tang & Chuyi Teng, 2024. "Evaluating Regional Potentials of Agricultural E-Commerce Development Using a Novel MEREC Heronian-CoCoSo Approach," Agriculture, MDPI, vol. 14(8), pages 1-16, August.
    9. Neeraj Singh & Kushankur Dey, 2023. "A typology of agricultural market information systems and its dimensions: Case studies of digital platforms," Electronic Markets, Springer;IIM University of St. Gallen, vol. 33(1), pages 1-22, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Danne, M. & Musshoff, O. & Schulte, M., 2019. "Analysing the importance of glyphosate as part of agricultural strategies: A discrete choice experiment," Land Use Policy, Elsevier, vol. 86(C), pages 189-207.
    2. Sauthoff, Saramena & Danne, Michael & Mußhoff, Oliver, 2017. "To switch or not to switch? – Understanding German consumers’ willingness to pay for green electricity tariff attributes," Department of Agricultural and Rural Development (DARE) Discussion Papers 260771, Georg-August-Universitaet Goettingen, Department of Agricultural Economics and Rural Development (DARE).
    3. Adamides, George & Stylianou, Andreas & Kosmas, Petros C. & Apostolopoulos, Constantinos D., 2013. "Factors Affecting PC and Internet Usage by the Rural Population of Cyprus," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 14(1), pages 1-21.
    4. Danne, Michael & Mußhoff, Oliver, 2018. "Producers' valuation of animal welfare practices: Does herd size matter?," DARE Discussion Papers 1801, Georg-August University of Göttingen, Department of Agricultural Economics and Rural Development (DARE).
    5. Danne, Michael & Fecke, Wilm & Mußhoff, Oliver, 2021. "Onlineeinkauf von Pflanzenschutzmitteln: Ein Discrete-Choice-Experiment mit landwirtschaftlichen Unternehmern in Deutschland," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 70(02), January.
    6. Danne, Michael & Fecke, Wilm & Mußhoff, Oliver, 2021. "Onlineeinkauf von Pflanzenschutzmitteln: Ein Discrete-Choice-Experiment mit landwirtschaftlichen Unternehmern in Deutschland," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 70(02), January.
    7. Mishra, Ashok K. & Williams, Robert P. & Detre, Joshua D., 2009. "Internet Access and Internet Purchasing Patterns of Farm Households," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 38(2), pages 1-18, October.
    8. Nguyen, Manh-Hung & Nguyen, Thi Lan Anh & Nguyen, Tuan & Reynaud, Arnaud & Simioni, Michel & Hoang, Viet-Ngu, 2021. "Economic analysis of choices among differing measures to manage coastal erosion in Hoi An (a UNESCO World Heritage Site)," Economic Analysis and Policy, Elsevier, vol. 70(C), pages 529-543.
    9. Briggeman, Brian C. & Whitacre, Brian E., 2010. "Farming and the Internet: Reasons for Non-Use," Agricultural and Resource Economics Review, Cambridge University Press, vol. 39(3), pages 571-584, October.
    10. Reithmayer, Corrina & Danne, Michael & Mußhoff, Oliver, 2019. "Look at that! – The effect pictures have on consumer preferences for in ovo gender determination as an alternative to culling male chicks," Department of Agricultural and Rural Development (DARE) Discussion Papers 298419, Georg-August-Universitaet Goettingen, Department of Agricultural Economics and Rural Development (DARE).
    11. Baer, Alexander G. & Brown, Cheryl, 2007. "Adoption of E-Marketing by Direct-Market Farms in the Northeastern United States," Journal of Food Distribution Research, Food Distribution Research Society, vol. 38(2), pages 1-11, July.
    12. Spaulding, Aslihan D. & Tudor, Kerry W. & Mahatanankoon, Pruthikrai, 2015. "The Effects of Outcome Expectations on Individual’s Anxiety and Continued Usage of Mobile Devices: A Post-Adoption Study," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 18(4), pages 1-16, November.
    13. Baer, Alexander G. & Brown, Cheryl, 2006. "Adoption of E-Marketing by Direct Market Farms in the Northeastern U.S," 2006 Annual meeting, July 23-26, Long Beach, CA 21320, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    14. Yang, Yang & Hobbs, Jill E. & Natcher, David C., 2020. "Assessing consumer willingness to pay for Arctic food products," Food Policy, Elsevier, vol. 92(C).
    15. 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.
    16. Jemal Ahmed & Tewodros Tefera & Girma T. Kassie, 2020. "Consumers’ preference and willingness to pay for enriched snack product traits in Shashamane and Hawassa cities, Ethiopia," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 8(1), pages 1-20, December.
    17. Bartczak, Anna, 2015. "The role of social and environmental attitudes in non-market valuation," Forest Policy and Economics, Elsevier, vol. 50(C), pages 357-365.
    18. Smith, Aaron D. & Goe, W. Richard & Kemey, Martin & Morrison Paul, Catherine J., 2004. "Computer and Internet Use by Great Plains Farmers," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 29(3), pages 1-20, December.
    19. Gloy, Brent A. & Akridge, Jay T., 2000. "Computer And Internet Adoption On Large U.S. Farms," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 3(3), pages 1-16.
    20. Golo-Friedrich Bauermeister & Oliver Mußhoff, 2019. "Multiple switching behaviour in different display formats of multiple price lists," Applied Economics Letters, Taylor & Francis Journals, vol. 26(1), pages 58-63, January.

    More about this item

    Keywords

    Internet use; E-commerce; Input purchasing; Online merchants; German farmers;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:daredp:1803. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/iagoede.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.