Eco-Labelled Food Products : What are Consumers Paying For?

The paper investigates whether the premium consumers are willing to pay for an eco-labelled product is driven by selfish or altruistic motives. Using an incentive-compatible experiment with both a within- and a between-subject design, we study the effect on this premium of information stating that eco-friendly products do not necessarily lead to higher private benefits. We find that this information does not affect buying prices in the within-subject experiment. This suggests that consumers' willingness to pay for the eco-labelled product does not derive from perceived higher taste or safety attributes but from other motives. These results are confirmed in the between-subject design where we find that information affects buying prices for the eco-friendly product but also for the control product in the between-subject experiment