Identifier

etd-01052006-121418

Degree

Master of Science (MS)

Department

Agricultural Economics

Document Type

Thesis

Abstract

Survey data collected from randomly selected participants within the four geographical regions of the U.S. were used to evaluate consumer attitudes towards functional foods and determine their willingness to pay for these foods. Contingent valuation using the payment card method was used to elicit premiums that consumers are willing to pay for a spread that maintains a healthy heart (spread A), a spread that is proven to significantly reduce cholesterol (spread B) and a loaf of bread that may reduce the risk of heart disease and certain cancers (bread A). Ordered probit regression analysis was used to evaluate the effect of different explanatory variables on the willingness to pay a premium for the three different functional food products. Overall, the following four factors significantly affected the respondents’ willingness to pay a premium for all the three products evaluated: beliefs about the link between nutrition and health, concern about different chronic diseases, current purchasing and consumption patterns, and attitude towards functional foods. These factors also seem to affect the decision of whether to pay a premium for functional foods more than the decision of how much to pay. The significance of demographic variables depended on the product being valued. Regarding the premiums, on average respondents are willing to pay the current grocery store premium for spread A. On average, respondents are not willing to pay even half of the current grocery store 500% premium for spread B, although the stated WTP results indicated that 9%, are willing to pay at least 400% premium. For bread A, respondents are on average willing to pay a 33% premium instead of the current grocery store 40% premium. Stated WTP indicated that about 42% of the respondents are willing to pay at least a 50% premium for the functional bread.

Date

2006

Document Availability at the Time of Submission

Release the entire work immediately for access worldwide.

Committee Chair

Wes Harrison

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