Habit spillovers or induced awareness: Willingness to pay for eco-labels of rice in China

•The heterogeneous WTP for eco-labels of rice is studied for Chinese consumers.•Habit spillovers from PEBs and induced awareness are sources of heterogeneities.•Two catalyst PEBs increase the WTP for eco-labels through spillover effects.•Induced awareness of eco-farming further raises the WTP on the intensive margin.•Catalyst PEBs depend on consumers' educational attainment and family income.

The willingness to pay (WTP) for eco-labeled rice is investigated for Chinese consumers using choice experiments with information interventions. The mixed logit model shows preference heterogeneities, and the latent class model unveils two sources: pro-environmental behaviors with spillover effects, which are defined as “catalyst behaviors”, and the awareness about imperatives of ecological farming, which is defined as “induced awareness”. Classification results identify that using BP bags and sorting waste are “catalyst behaviors”. As the multivariate ordered probit model implies, consumers with higher educational attainment and family income levels are more likely to adopt these behaviors. Instead of creating the preference for eco-labels, the “induced awareness” is only found to strengthen preferences that already exist. The results of this study provide policy implications for the design of proper strategies to develop the eco-labeled food market, especially in developing economies.