Impact of private labels and promotion on ecolabeled food

Résumé 0

We use revealed preference to determine consumers’ preferences for organic and fair trade food products. We especially focus on the impact of private labels and promotion on organic milk, organic eggs and fair trade coffee demands. Expenditure elasticities show organic milk, privete-labeled eggs and national brand fair trade coffee are necessity goods while national brand eggs and private-labeled fair trade coffee are normal goods. We find demand for national brand organic milk is considerably elastic while demands for all other ecolabeled goods are inelastic. Cross-price elasticities show that national brand organic and fair trade goods are substitutes to their conventional counterparts while national brand ecolabeled goods are complements to private-labeled conventional counterpart. Finally, promotion for organic products has a positive impact on private-labeled organic product demand while promotion for fair trade products has a positive impact on national brand fair trade coffee.