The economics of quality in the specialty coffee industry: insights from the Cup of Excellence auction programs

Wilson, Adam P.; Wilson, Norbert L.W.

doi:10.1111/agec.12132

Cited by 40 publications

(28 citation statements)

References 39 publications

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“…Differentiated attributes of coffee include place of origin, organic production, fair trade production and eco‐friendly production methods (Lewin et al, ), including shade‐grown. Since the coffee crisis of the 1990s, ‘coffee has been on the leading edge of many international development schemes’ (Wilson & Wilson, ) and understanding consumer willingness to pay (WTP) for coffee certification labels is one piece of determining the value of development schemes that involve coffee certification. The goal of this study was to investigate WTP for shade‐grown coffee at a U.S.…”

Section: Introductionmentioning

confidence: 99%

Comparing stated and realized preferences for shade‐grown vs. conventionally grown coffee

Klimas

Webb

2017

Int J Consumer Studies

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We used both stated preference and revealed preference data to estimate willingness to pay (WTP) for shade-grown coffee as compared with conventionally grown coffee. Stated preference data was collected using contingent valuation studies. Revealed preference data came from an experiment where all survey participants received a personally identifiable voucher redeemable for a free bakery item when the holder purchased a coffee. We compared estimates of mean and median WTP a price premium for shade-grown coffee from stated preference data with similar estimates from revealed preference data. We used a logit model to evaluate the effect of explanatory variables (measures of environmental attitudes, personal norms for pro-environmental behaviour and demographic variables) on respondents' WTP a price premium for shade grown coffee. Model parameters were estimated using the maximum likelihood approach. Respondents with higher scores on measures of environmental attitudes and personal norms for proenvironmental behaviour were, on average, willing to pay more for shade-grown coffee. While this paper examined a specific case, purchase of shade-grown coffee, our results confirmed that stated environmental concern was a good predictor of pro-environmental behaviour. We found that mean and median WTP estimates from stated preference methods were higher, but not significantly different than mean and median WTP estimates from actual purchases, indicating convergent validity between stated and realized preference methods. The majority of individuals both stated WTP a price premium and purchased shade-grown coffee at a price premium. We did, however notice some interesting behaviour at the individual level where stated preferences under-predicted realized preferences at low price-premia and over-predicted realized preferences at high price premia.

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Section: Introductionmentioning

confidence: 99%

Comparing stated and realized preferences for shade‐grown vs. conventionally grown coffee

Klimas

Webb

2017

Int J Consumer Studies

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“…If they are not, they lose the ability to connect with clients who are searching for unique products that Burundi is capable of producing. This is an important market niche for Burundian producers, which should not be overlooked, as third wave coffee roasters often pay significantly higher prices to producers to secure access to high material quality coffees (Borrella et al, 2015;Lundy et al, 2012;Peterson, 2013;Wilson and Wilson, 2014;Wilson et al, 2012).…”

Section: Discussionmentioning

confidence: 99%

“…Whilst there is a significant body of sustainability-oriented research and debate on the development possibilities derived from the symbolic quality attributes of coffee (Bacon, 2005;Blackman and Rivera, 2011;Elder et al, 2014;Giovannucci and Ponte, 2005;Hudson and Hudson, 2003;ITC, 2011b;Lyons, 2005;Ponte, 2004;Raynolds et al, 2007;Vermeulen and Metselaar, 2015), less attention has been paid to how the material quality attributes of coffee are involved in the sustainable coffee discourse (Borrella et al, 2015;Goldstein, 2011;Wilson and Wilson, 2014). 'Cup quality' is the term that coffee professionals and aficionados use to refer to material quality (Steiman, 2013;Sunarharum et al, 2014;Wilson and Wilson, 2014). Whilst implementation of a sustainability certification may contribute to material quality improvements, none of the available mainstream sustainability standards are able to certify material quality attributes (Goldstein, 2011;Linton et al, 2004).…”

Section: A Ccess To the Global Coffee Market For Smallholder Producermentioning

confidence: 99%

“…However, in order to compete on the basis of material quality, producers need to have a clear idea of the quality practices demanded by buyers who purchase exemplary material quality coffee. Unfortunately, there is a scarcity of accessible information that can serve as a guide to producers on how to make investment decisions to compete with the material quality of their production (Wilson and Wilson, 2014). Unlike the rigid requirements of mainstream sustainability certifications (symbolic quality), there is a high level of flexibility regarding production practices for improving material quality attributes.…”

Section: A Ccess To the Global Coffee Market For Smallholder Producermentioning

confidence: 99%

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Practices of Third Wave Coffee: A Burundian Producer's Perspective

2018

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The relationship between coffee quality and sustainability is typically analysed using symbolic quality attributes, not material quality. This article provides a bottom-up perspective of Burundi's current competitive advantage in the global coffee market: material quality. The research agenda was embedded within the operations of a Burundian coffee washing station and describes critical business practices for producing and selling high material quality coffee. We argue that these business practices represent quality governance mechanisms that are significantly different from the exogenous and fixed criteria of sustainability certifications and labels. Such quality governance mechanisms are an important trading trend to recognize and understand in a producing country such as Burundi that is unable to effectively compete in the certified coffee market because of the small size and irregularity of its supply.

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“…Following other studies examining product quality (e.g. Wilson and Wilson, 2014) and its established position in this literature (Malpezzi, 2002) a log-linear functional form 9…”

Section: The Testing Frameworkmentioning

confidence: 98%

The price, quality and distribution of mortgage payment protection insurance: A hedonic pricing approach

Ashton

Hudson

2017

The British Accounting Review

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Peer reviewed versionCyswllt i'r cyhoeddiad / Link to publication Dyfyniad o'r fersiwn a gyhoeddwyd / Citation for published version (APA): Ashton, J., & Hudson, R. S. (2017). The price, quality and distribution of mortgage payment protection insurance: A hedonic pricing approach. British Accounting Review, 49(2), 242-255. AbstractMortgage payment protection insurance (hereafter MPPI) provides varying combinations of accident, sickness and unemployment insurance and is used to protect the mortgage payments of policyholders in the event of a fall in income. Despite alleviating housing market failures, this service has been heavily criticised for providing poor value for money and being associated with unhelpful sales techniques especially when sold jointly with a mortgage in the UK. Consequently, the Competition Commission (2009) ruled that after February 2011 MPPI should not be sold jointly with mortgage lending within seven days of the credit transaction. We examine whether this prohibition was justified and if the form of distribution, either jointly with the mortgage or independently influences the premium levels. This assessment uses a hedonic pricing approach with details and premiums of MPPI policies in 2010 and 2012. Despite the success in reducing MPPI premium levels, we conclude that the Competition Commission judgement has raised concerns as to mortgagee protection.The price, quality and distribution of mortgage payment protection insurance: A hedonic pricing approach 1. ** denotes statistically significant at 5%, * denotes 10% significance † Note the total number of policies is not the sum of the numbers of independent and jointly sold policies as a small number of policies are distributed using both methods.

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The economics of quality in the specialty coffee industry: insights from the Cup of Excellence auction programs

Cited by 40 publications

References 39 publications

Comparing stated and realized preferences for shade‐grown vs. conventionally grown coffee

Comparing stated and realized preferences for shade‐grown vs. conventionally grown coffee

Practices of Third Wave Coffee: A Burundian Producer's Perspective

The price, quality and distribution of mortgage payment protection insurance: A hedonic pricing approach

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