Consumers’ Preferences for Environmentally Safe Agricultural Products (Case Study: Vegetables in Urmia)

Abstract
The main goal of this paper is estimating willingness to pay of households for safe and pesticide-free vegetables using Contingent Valuation Method (CVM) in Urmia. Data were collected by face to face surveying of 336 respondents in 2012. To determine the effective factors on willingness to pay, logit models using linear and logarithmic functional forms (restricted and unrestricted models) were estimated. Comparing functional forms showed that the restricted linear logit model (model with only significant explanatory variables) has better fit in regard to other models. Results showed that offered bid, willingness to buy safe products, eating out of home, age, marital status, number of family members, education level and level of income have significant effects on the probability of accepting offered bid. The expected value of willingness to pay is estimated 26790.48 Rials; that shows people are willing to pay 26790 Rials per kilogram of safe and pesticide-free vegetables. This estimate can be an instrument in policy-makers hand for planning to produce agricultural pesticide-free crops.

JEL Classification: Q51, Q57

Keywords:
Preferences, Safe Agricultural Products, Willingness to Pay, Vegetables, Urmia