The sum of all the fears: the role of attitude towards health and environmental risks in the WTP a premium for organic foods

Summary

Many empirical studies underline that the main reasons for purchasing organic foods are the protection of health and environment and that the organic price premium is one of the major barriers to their consumption. These studies also show that there is a strong heterogeneity of these organic premiums as well as the Willingness To Pay (WTP) an organic premium. However, it is clear from these studies that there is no consensus concerning the determinants of these WTP. This article focuses on the question of the formation of these WTP an organic premium when the consumer decides to commit himself in a long-lasting consumption of organic foods to protect his health and environment. Using a dynamic analysis framework, we show that there is not one but several WTP and their determinants are a synthesis combining the consumer's characteristics but also his fears on the environmental impact of conventional agriculture as well as his fears about how a regular consumption of conventional food directly affects his life expectancy. We also show that the price barrier should be analyzed dynamically: for a consumer, the same price of organic foods may initially dissuade him from consuming organic foods but not necessarily throughout his life.