Frequent food quality and safety issues result in various food inspection measures in China, while some are not widely acknowledged by the public and are less efficient. Consumer demand is significant for priority setting in food policy. This study investigates Chinese consumers' heterogeneous preferences for selected food inspection measures and estimates welfare effects based on willingness-to-pay (WTP) calculation. Rice consumption data from a 2018 nationwide consumer survey designed using the real choice experiment is analyzed by the random parameters logit and the latent class model. The findings reveal that consumers place a high value on government certification, and brand is valuable especially when public management is perceived as weak. However, the insufficient market demand for third-party certification may increase transaction costs due to overlapping functions and consumers' distrust. Moreover, there should be a need to broaden consumers' understanding of traceability and grading systems. This study emphasizes the necessity of direct governmental involvement and the existence of unnecessary policy cost.Sustainability 2018, 10, 4003 2 of 15 by the public and are less efficient for reducing information asymmetries. Since consumers are the main beneficiaries of enhanced food management systems, what consumers prefer in a demand-oriented market may drive the focus of public policy-making and the food suppliers' operating decisions.Much attention regarding consumer preferences and WTP focused on livestock and aquaculture, ranging from certification, traceability, and quality grading systems [4-6] to country-of-origin, local and ecological labels [7][8][9]. However, few studies were dedicated to analyzing plant products. Compared to animal products, plant products in China are consumed with larger quantity and higher frequency, among of which rice is likely to be the most typical plant product that faces serious food quality and safety issues. A rough estimate based on the China Statistical Yearbook 2017 [10] and the Chinese Nutrition and Health Status 2004 indicates that rice is the most frequently-consumed staple for at least two-thirds of the Chinese urban population. Rice consumption areas in China are mainly: the 15 provinces of
Food safety and food quality are two closely related aspects of the food management system. The difference between the two is that one keeps consumers safe while the other keeps consumers satisfied. This study examined the differences in how consumers value food safety and food quality with a focus on the influence of loss aversion on one’s psychological level and of income effect on one’s socio-demographic level. Our findings indicate that loss aversion and income effect significantly influence the way consumers value food safety vs. quality labels when considering potential health risks and food price. High risk-averse and low-income consumers with strong loss aversion and a weak income effect show a higher demand for food safety labels as a way to ensure easy access to safety indications. Low risk-averse and high-income consumers with weak loss aversion and a strong income effect show a higher demand for food quality labels because they hope to gain more health benefits from high-quality food at good prices. This study provides insights that will assist public authorities and food industry in balancing food safety control and food quality improvement in order to meet the heterogeneous market demand changing alongside the transition of China’s food consumption and production.
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