The sum of all the fears: the role of attitude towards health and environmental risk 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 price premium associated with organic foods is one of the major barriers to consumption of these products. These studies also show that there is a very strong heterogeneity of these organic premiums as well as the Willingness To Pay (WTP) an organic premium. However, it is also clear from these studies that there is no consensus concerning the determinants of these WTP for organic foods. This article focuses on the question of the formation of these WTP a price premium for organic foods when the consumer decides to commit himself in a long-lasting consumption of organic foods in order to protect his health and environment. Using a dynamic analysis framework, we show that there is not one but potentially several WTP a price premium and their determinants are a synthesis combining the characteristics of the consumer (e.g. income, life expectancy) but also his fears on the environmental impact of conventional agriculture as well as his fears about how regular consumption of conventional food directly affects his own 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.