Elicitation formats and the WTA/WTP gap: A study of climate neutral foods

- We ask whether consumers are WTP a premium for foods with climate neutral labels.
- We conduct a field valuation experiment.
- We examine the robustness of the WTA/WTP gap.
- We vary the valuation method (contingent valuation vs. inferred valuation).
- We also vary the payment format (dichotomous choice vs. payment card).
- The payment card format can mute the gap.
- We find average WTP premiums of up to 28% (23%) for climate neutral eggs (olive oil).

Private carbon-labelling programmes for food products can be seen as short term strategies for curbing carbon emissions. We conduct a field valuation experiment to determine whether consumers place a positive value on foods with climate neutral labels. We explore whether the estimated value of climate neutral foods can be influenced by several methodological choices, such as the valuation method (contingent valuation vs. inferred valuation), elicitation format (dichotomous choice vs. payment card), and reference point (willingness-to-accept vs. willingness-to-pay). We find that the WTA/WTP gap is similar between valuations elicited with the contingent vs. the inferred valuation method. However, we also find that the gap can be muted by using a payment card elicitation format. Overall, we find average willingness to pay premiums of up to 28% and 23% for climate neutral eggs and olive oil, respectively.