Measuring rural consumers’ willingness to pay for quality labels using experimental auctions: the case of aflatoxin‐free maize in Kenya

Abstract

Aflatoxins are a common health hazard in tropical countries, especially in rural areas. New methods to reduce aflatoxin levels in food staples, as well as cheaper test methods, are being developed, but consumers' willingness to pay (WTP) for these improvements is unknown. A survey was conducted with a representative sample of rural consumers (1,344 in total, 63% women) in all major maize-production zones of Kenya. The survey included an experimental auction with maize products of different qualities. The results showed that many rural consumers were aware of aflatoxins, but few understood their health risks. Respondents were willing to pay a premium for maize tested for aflatoxins and labeled, but asked a high discount for maize that was visibly contaminated with moldy grain. The premium was higher for respondents with education and in regions with aflatoxicosis outbreaks. Knowledge of aflatoxins substantially reduced the overall WTP, but did not increase the WTP for tested maize. Welfare analysis indicates that mandatory testing would result in substantial benefits if the cost of testing can be lowered to below the premium. JEL classifications: D12, D61, I12

You get what you pay for: the link between price and food safety in Kenya

“…Data collection occurred over six months at 11 shops and small supermarkets in eight different towns in eastern and central Kenya. These areas were chosen because of their relatively high levels of aflatoxin contamination and consumer awareness of the toxin compared with other areas of Kenya (de Groote et al., ). The sample was selected to represent the sales volume of each brand at each shop, according to the shop manager.…”

Willingness to pay of Nigerian poultry producers and feed millers for aflatoxin‐safe maize

“…Testing will be one of the first steps. Testing must be simple, economical, and accessible as a first step for reaping the benefits from aflatoxin control (De Groote et al, ).…”

“…Strong agribusiness WTP could have beneficial spillover effects on other parts of the Nigerian maize value chain, especially farmers that may be able to receive higher prices for their maize production. As identified by De Groote et al () cost‐effective testing of the aflatoxin levels in maize will be needed for a market for aflatoxin‐safe maize to function efficiently.…”

“…De Groote et al () provided an information treatment to half of the consumers, explaining that consuming large quantities of aflatoxin can cause death and that chronic aflatoxin exposure can lead to liver cancer. De Groote et al () found the effects of providing an aflatoxin information treatment to be similar to the effects of knowledge of whether aflatoxin was toxic. Consumers that received the treatment were not willing to pay more for tested maize than consumers who did not receive the treatment.…”

Can local products compete against imports in West Africa? Supply-and demand-side perspectives on chicken, rice, and tilapia in Accra, Ghana

“…During the auctions, participants were required to purchase the products won during the bidding process (De-Groote et al 2016). This was to preserve the incentive-compatible property of the auction mechanism throughout the experiment.…”