A Calibrated Auction-Conjoint Valuation Method: Valuing Pork And Eggs Produced
This study investigates how much consumers are willing to pay for pork and egg products produced with higher welfare standards. To try to get a more accurate measure, this study used a method to test consumer preferences that relies on having people choose between various products as opposed to simply having them report what they think they might be willing to spend. The study found that people are willing to pay a certain amount more for improvements in animal welfare. On average, US consumers will pay $0.95 more for one dozen cage free eggs and $2.02 more for two pounds of meat from pasture raised pigs.
Article Abstract:
“This paper develops a valuation method which generates consistent and systematic estimates of people’s preferences for complex multi-attribute goods by inextricably linking auction bids with conjoint ratings. The advantage of the valuation approach is that it permits the estimation of people’s values for many potential goods, allows one to decompose people’s values for a good into its sub-components, and permits the study of preference heterogeneity without distributional assumptions. We apply the method to an important and increasingly controversial topic: animal welfare. The method is used to determine people’s preferences for eggs and pork produced from different production systems.”
“Data from experiments conducted in three diverse U.S. locations (Chicago, IL; Dallas, TX; and Wilmington, NC) indicates that people are, on average, willing to pay $0.95 more for a dozen eggs raised in an aviary, pasture system vs. a cage system, and are willing to pay $2.02 more for two-pounds of pork chops raised in a pasture system as opposed to a crate system.”