Abstract
The 18th and 19th centuries witnessed the emergence of ethical consumption in Europe and America, which paved the way for fair-trade products to go mainstream of ethical consumption in the 20th century (Yen et al., 2017). Fair trade is defined as trade partnerships fostering the sustainable linkages between producers and consumers (Jaffee et al., 2004), benefitting producers in the long-term while offering consumers an ethical choice to exercise (Lee et al., 2015).
Few studies pay heed to the economic perspectives and consumers' willingness to pay ethical premia for FT products or the concept of consumer identity from sociological approaches (Andorfer & Liebe, 2012). To date, this conclusion holds with scant attention to understanding consumers' willingness to pay a premium for FT products, particularly via consumers' identity building.
Recent ethical consumption studies recommend the usefulness of product attributes in reflecting values upheld by consumers (Khare, 2019, 2020), which, in turn, predict consumption behaviours (Khare, 2019). Indeed, having an ethical brand is not sufficient to attract consumers to the fair-trade market; companies must ensure a product of good quality and appealing appearance (Lee et al., 2015). During the decision-making process, consumers rely on different attributes or cues before deciding what to buy and whether to buy it (Ragaert et al., 2004). Since attributes are evaluative criteria based on which consumers form beliefs and develop attitudes and intentions, insights into attributes' perceived importance and evaluation are pivotal to elucidating consumer behaviours (Ragaert et al., 2004).
Study Focus
The important role of identity on willingness to pay for fair-trade products has been proven in literature; however, to date, consumers' identity building and its mechanism of impact on willingness to pay have received scant attention. Drawn from Identity theory, this study investigates the formation of consumers' multiple identities pinpointed from product attributes as cues to extricate the mechanism of impacts.
Research Design
Data was collected from a total of 3,020 participants from the UK (1,009), France (1002), and Germany (1012) using an online survey. Structural equation modelling was employed to analyse the data.
Findings
This study confirmed the positive impact of self-identity on willingness to pay indicating that consumers are willing to pay extra when the product matches their self-identity. Self-gratification significantly influences self-identity and willingness to pay a premium for fair-trade products. Safety and ethical cues influenced self-identity significantly. The association between self-identity and willingness to pay is stronger with the presence of organoleptic characteristics and grade but decrease when safety and ethical cue becomes more important.
Few studies pay heed to the economic perspectives and consumers' willingness to pay ethical premia for FT products or the concept of consumer identity from sociological approaches (Andorfer & Liebe, 2012). To date, this conclusion holds with scant attention to understanding consumers' willingness to pay a premium for FT products, particularly via consumers' identity building.
Recent ethical consumption studies recommend the usefulness of product attributes in reflecting values upheld by consumers (Khare, 2019, 2020), which, in turn, predict consumption behaviours (Khare, 2019). Indeed, having an ethical brand is not sufficient to attract consumers to the fair-trade market; companies must ensure a product of good quality and appealing appearance (Lee et al., 2015). During the decision-making process, consumers rely on different attributes or cues before deciding what to buy and whether to buy it (Ragaert et al., 2004). Since attributes are evaluative criteria based on which consumers form beliefs and develop attitudes and intentions, insights into attributes' perceived importance and evaluation are pivotal to elucidating consumer behaviours (Ragaert et al., 2004).
Study Focus
The important role of identity on willingness to pay for fair-trade products has been proven in literature; however, to date, consumers' identity building and its mechanism of impact on willingness to pay have received scant attention. Drawn from Identity theory, this study investigates the formation of consumers' multiple identities pinpointed from product attributes as cues to extricate the mechanism of impacts.
Research Design
Data was collected from a total of 3,020 participants from the UK (1,009), France (1002), and Germany (1012) using an online survey. Structural equation modelling was employed to analyse the data.
Findings
This study confirmed the positive impact of self-identity on willingness to pay indicating that consumers are willing to pay extra when the product matches their self-identity. Self-gratification significantly influences self-identity and willingness to pay a premium for fair-trade products. Safety and ethical cues influenced self-identity significantly. The association between self-identity and willingness to pay is stronger with the presence of organoleptic characteristics and grade but decrease when safety and ethical cue becomes more important.
| Original language | English |
|---|---|
| Number of pages | 2 |
| Publication status | Published - 2024 |
| Externally published | Yes |
| Event | 68th Annual Conference of the Australasian Agricultural & Resource Economics Society - Australian National University, Canberra, Australia Duration: 6 Feb 2024 → 9 Feb 2024 https://www.aares.org.au/AARES2024 |
Conference
| Conference | 68th Annual Conference of the Australasian Agricultural & Resource Economics Society |
|---|---|
| Country/Territory | Australia |
| City | Canberra |
| Period | 6/02/24 → 9/02/24 |
| Internet address |
Keywords
- Agribusiness
- Consumer Choice
