Assessing Consumers’ Valuation of Cosmetically Damaged Apples Using a Mixed Probit Model
Chengyan Yue, Helen H. Jensen, Daren S. Mueller, Gail R. Nonnecke, Mark L. Gleason
December 2005 [05-WP 419]
Yue, C., H.H. Jensen, D. Mueller, G. Nonnecke, and M. Gleason. 2005. "Assessing Consumers’ Valuation of Cosmetically Damaged Apples Using a Mixed Probit Model." Working paper 05-WP 419. Center for Agricultural and Rural Development, Iowa State University.
A mixed probit model was applied to survey data to analyze consumers' willingness to buy apples with cosmetic damage caused by the sooty blotch and flyspeck (SBFS) disease complex. The analysis finds consumers will pay a premium for organic production methods and for apples with low amounts of SBFS damage. Behavioral variables such as experience in growing fruit significantly affect the willingness to buy apples of different damage levels. Consumers' tolerance of very blemished apples is limited and they trade off production technology attributes for cosmetic appearance. Better understanding of this trade-off is important to organic producers' decisions about disease control.
Keywords: apples, sooty blotch and flyspeck, organic, cosmetic damage, willingness to buy, mixed probit model.