Valuation and Price Dispersion: Quantile Regression vs. Stochastic Frontier – an Application to Health Claims in Yogurts

A. Bonanno, F. Bimbo, M. Constanigro, A.G.J.M. Oude Lansink, R. Viscecchia

Research output: Contribution to conferenceConference paperAcademic

Abstract

Food manufacturers use health claims to signal higher product quality and attract health oriented consumers. However, consumers’ willingness to pay for health-related attributes may not be large enough to repay firms of the high costs associated with developing, certifying, and marketing such products. We investigate the impact of several health-related credence attributes on product’s price, and what may help manufacturers to reach consumers with the highest willingness to pay for yogurt. To achieve our goals we use a large database of yogurt sales in Italy and two empirical approaches recently introduced in the hedonic price literature: Quantile Regression (QR) and Stochastic Frontier Analysis (SFA). Results show that the implicit prices of health claims differ across price levels (i.e. quantiles), and that manufacturers differ in their ability to target consumers with high willingness to pay.
Original languageEnglish
Publication statusPublished - 2015
Event29th International Conference of Agricultural Economists ICAE - Milan, Italy
Duration: 8 Aug 201514 Aug 2015

Conference

Conference29th International Conference of Agricultural Economists ICAE
CountryItaly
CityMilan
Period8/08/1514/08/15

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Quantile regression
Price dispersion
Stochastic frontier
Health claims
Willingness-to-pay
Health
Stochastic frontier analysis
Quantile
Hedonic prices
Data base
Food
Marketing
Product quality
Italy
Price level
Costs
Implicit price

Cite this

Bonanno, A., Bimbo, F., Constanigro, M., Oude Lansink, A. G. J. M., & Viscecchia, R. (2015). Valuation and Price Dispersion: Quantile Regression vs. Stochastic Frontier – an Application to Health Claims in Yogurts. Paper presented at 29th International Conference of Agricultural Economists ICAE, Milan, Italy.
Bonanno, A. ; Bimbo, F. ; Constanigro, M. ; Oude Lansink, A.G.J.M. ; Viscecchia, R. / Valuation and Price Dispersion: Quantile Regression vs. Stochastic Frontier – an Application to Health Claims in Yogurts. Paper presented at 29th International Conference of Agricultural Economists ICAE, Milan, Italy.
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abstract = "Food manufacturers use health claims to signal higher product quality and attract health oriented consumers. However, consumers’ willingness to pay for health-related attributes may not be large enough to repay firms of the high costs associated with developing, certifying, and marketing such products. We investigate the impact of several health-related credence attributes on product’s price, and what may help manufacturers to reach consumers with the highest willingness to pay for yogurt. To achieve our goals we use a large database of yogurt sales in Italy and two empirical approaches recently introduced in the hedonic price literature: Quantile Regression (QR) and Stochastic Frontier Analysis (SFA). Results show that the implicit prices of health claims differ across price levels (i.e. quantiles), and that manufacturers differ in their ability to target consumers with high willingness to pay.",
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Bonanno, A, Bimbo, F, Constanigro, M, Oude Lansink, AGJM & Viscecchia, R 2015, 'Valuation and Price Dispersion: Quantile Regression vs. Stochastic Frontier – an Application to Health Claims in Yogurts' Paper presented at 29th International Conference of Agricultural Economists ICAE, Milan, Italy, 8/08/15 - 14/08/15, .

Valuation and Price Dispersion: Quantile Regression vs. Stochastic Frontier – an Application to Health Claims in Yogurts. / Bonanno, A.; Bimbo, F.; Constanigro, M. ; Oude Lansink, A.G.J.M.; Viscecchia, R.

2015. Paper presented at 29th International Conference of Agricultural Economists ICAE, Milan, Italy.

Research output: Contribution to conferenceConference paperAcademic

TY - CONF

T1 - Valuation and Price Dispersion: Quantile Regression vs. Stochastic Frontier – an Application to Health Claims in Yogurts

AU - Bonanno, A.

AU - Bimbo, F.

AU - Constanigro, M.

AU - Oude Lansink, A.G.J.M.

AU - Viscecchia, R.

PY - 2015

Y1 - 2015

N2 - Food manufacturers use health claims to signal higher product quality and attract health oriented consumers. However, consumers’ willingness to pay for health-related attributes may not be large enough to repay firms of the high costs associated with developing, certifying, and marketing such products. We investigate the impact of several health-related credence attributes on product’s price, and what may help manufacturers to reach consumers with the highest willingness to pay for yogurt. To achieve our goals we use a large database of yogurt sales in Italy and two empirical approaches recently introduced in the hedonic price literature: Quantile Regression (QR) and Stochastic Frontier Analysis (SFA). Results show that the implicit prices of health claims differ across price levels (i.e. quantiles), and that manufacturers differ in their ability to target consumers with high willingness to pay.

AB - Food manufacturers use health claims to signal higher product quality and attract health oriented consumers. However, consumers’ willingness to pay for health-related attributes may not be large enough to repay firms of the high costs associated with developing, certifying, and marketing such products. We investigate the impact of several health-related credence attributes on product’s price, and what may help manufacturers to reach consumers with the highest willingness to pay for yogurt. To achieve our goals we use a large database of yogurt sales in Italy and two empirical approaches recently introduced in the hedonic price literature: Quantile Regression (QR) and Stochastic Frontier Analysis (SFA). Results show that the implicit prices of health claims differ across price levels (i.e. quantiles), and that manufacturers differ in their ability to target consumers with high willingness to pay.

M3 - Conference paper

ER -

Bonanno A, Bimbo F, Constanigro M, Oude Lansink AGJM, Viscecchia R. Valuation and Price Dispersion: Quantile Regression vs. Stochastic Frontier – an Application to Health Claims in Yogurts. 2015. Paper presented at 29th International Conference of Agricultural Economists ICAE, Milan, Italy.