Consumers' Valuation for a Reduced Salt Product: A Nonhypothetical Choice Experiment

Abstract

Reducing intakes of salt can help decrease a person's risk of heart-related chronic diseases. This study utilized a nonhypothetical choice experiment (with some hypothetical product options) to examine consumers' valuation for Reduced Salt canned ham in Korea. This study analyzed different sources of heterogeneity, such as correlation across utilities, income effects, and risk preferences, by estimating four different specifications of the random parameters logit model. Results suggest that the range of discount needed for consumers to switch from Reduced Salt canned ham to standard canned ham is 274 KRW ($USD 0.24) to 313 KRW ($USD 0.28) per can, which is approximately 7.8-8.9% of the average price of a canned ham. The results also suggest that consumers prefer the canned ham using domestic pork to the canned ham using imported pork. Moreover, respondents who are highly risk averse were more likely to purchase products with domestic ingredients.