Journal
APPLIED ECONOMIC PERSPECTIVES AND POLICY
Volume 35, Issue 3, Pages 476-507Publisher
OXFORD UNIV PRESS INC
DOI: 10.1093/aepp/ppt015
Keywords
Labeling; Advertising; Willingness to pay; Genetically modified organisms; Food demand; M31; Q13; Q18
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Using a lab experiment with 351 adult non-student subjects, we investigate the impact of labels and secondary information on willingness to pay (WTP) for foods that use various ingredients and processes that have been the subject of food policy discussions. We find a distinct asymmetry of WTP sensitivity between Contains X and Free of X labels with negatively-framed secondary information. The Free of X label has an impact only when secondary information is provided, and the negative impact of Contains X is mitigated by secondary information. We also consider how the results of our study can inform the ongoing debate about mandatory food labeling regulations in the United States: if mandatory labeling is adopted, providing additional information about what the product contains would significantly lessen the negative impact on demand.
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