Factors Affecting Consumers’ Potential Willingness to Pay for Organic Food Products in Iran: Case Study of Tabriz

In recent years, consumers’ concerns about environmental and health issues related to food products have risen; consequently, the demand for organically grown products has increased. In this respect, the aim of this study was to investigate factors affecting consumers’ potential willingness to pay premium prices for organic food products in Tabriz, Iran. An Ordered Logit regression model was applied to obtain the value of willingness to pay and determine the factors affecting it. Survey results showed that about ۹۵ percent of the respondents were willing to pay a premium; while about ۱۰ percent of them were willing to pay more than ۳۵ percent premium for organic food products. Results revealed that factors like "individual’s income", "family dimension", “environmental concerns" and "wholesome diet", besides "the general criteria of shopping", and "consumers’ awareness of these products’ characteristics" significantly increased consumers’ willingness to pay a premium. According to the results, married respondents as well as females were willing to pay a higher premium. In addition, those who had children younger than ۱۰ years old, elderly, or people with family members having special disease were significantly willing to pay a higher premium price for these products. More than ۸۰ percent of the consumers mentioned "absence of certifications and organic labels", "lack of advertisement", and "higher prices" as their most important problems in purchasing organic food products.

Keywords:

Contingent Valuation Method , Ordered-Logit model , Organic food , Price premium , WTP