Exploring quality and its value in the Italian olive oil market: a panel data analysis

Abstract

Olive oil markets, both traditional and new ones, are changing rapidly with vertical as well as horizontal differentiation that increasingly play a role in featuring demand and supply. The paper explores the role and effectiveness of different quality clues in the creation of value in high segments of the Italian olive oil market by applying a hedonic price model. Data come from one of the oldest and most reputed Italian guides Flos Olei which reviews around 250 Italian producers and their products. The study covers three production years (from 2012 to 2014) so that, besides the OLS estimations, a panel data analysis is also conducted. Main results indicate that consumers give value to features directly related to the product, as well as to the raw material used and to the production process; also, the kind of producer and the production area affect price. Moreover, the analysis shows the emerging role of experts in releasing valuable information about quality. On the contrary, European quality schemes, such as those for product origin and for organic production, do not bring additional value to consumers in the explored high market segments.

The Willingness to Pay in the Food Sector. Testing the Hypothesis of Consumer Preferences for Some Made in Italy Products

“…The possession of a university degree or a post-graduate degree increases the probability of purchasing Made in Italy products with the willingness to pay a premium price. These results correspond with the findings in previous studies of different Made in Italy products [23,30,61,62]. The type of profession does not seem to influence the willingness to pay for Made in Italy products.…”

“…Regarding the low significance of the age variable, the younger age group (18)(19)(20)(21)(22)(23)(24) shows a lower probability of the willingness to pay a premium price for Made in Italy products. This result may have two interpretations.…”

“…The expected average willingness to pay a premium price for Abruzzo oil (1 L) was €9.45 (±€2.67), Tuscany: €8.74 (±€2.69) and Puglia: €7.94 (±€3.42). The origin of the oil has a strong impact on the price, with over 50% of premium prices for oil from northern regions and 24% premium prices from central regions, compared to those of Southern Italy [23]. However, the presence of a certification of origin has not significantly influenced the willingness to pay a premium price.…”

In search of agri‐food quality for wine: Is it enough to join a geographical indication?

“…Empirically, the results of recent literature reviews are inconclusive, both among papers that study the role of agri‐food quality standards (including GIs) in hampering trade and economic development (e.g., Beghin, Maertens, & Swinnen, 2015) and among studies that address their value creation and market differentiation (e.g., Grunert & Aachmann, 2016). In particular, studies that analyze GIs as valuable signals of quality, for which consumers are willing to pay a premium (see Deselnicu, Costanigro, Souza‐Monteirsbo, & McFadden, 2013 and Leufkens, 2018 for a review), are not conclusive, with some authors reporting null or negative market values for GIs (Carbone, Cacchiarelli, & Sabbatini, 2018; Hayes, Lence, & Stoppa, 2004; Herrmann & Teuber, 2011). Moreover, the willingness to pay depends on a complex variety of factors other than quality (Oczkowski & Doucouliagos, 2015).…”

Eleven Monovarietal Extra Virgin Olive Oils from Olives Grown and Processed under the Same Conditions: Effect of the Cultivar on the Chemical Composition and Sensory Traits

“…MEVOOs are defined as oils obtained by the transformation of olives from one variety. Traditionally, EVOOs are made of blends of all the olive varieties present on each farm but more recently, milling technology and machinery allow for separate milling of even small quantities of olives [ 3 ].…”