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Journal of Economic Integration 2021 March;36(1) :162-184.
DOI: https://doi.org/10.11130/jei.2021.36.1.162
Regional Origin Outperforms All Other Sustainability Characteristics in Consumer Price Premiums for Honey: Empirical Evidence for Germany

Katharina BissingerRoland Herrmann 

Justus-Liebig-Universität Giessen, Germany
Corresponding Author: Katharina Bissinger ,Email: Katharina.M.Bissinger@agrar.uni-giessen.de
Copyright ©2021 Journal of Economic Integration
ABSTRACT
Sustainability and online retailing are two of the main challenges in the food industry. This study analyzes how honey characteristics, including sustainability indicators, affect consumer prices for honey, using 241 German honey prices in online and offline retailing. Many honey characteristics significantly influence honey prices. However, a clear identification of the regional origin of honey has a particularly strong impact on the consumer price premium. It outperforms all other sustainability indicators such as fairtrade certification, organic production, and environmentally friendly packaging. Regional origins that receive high relative and absolute consumer price premiums are Germany and German regions as well as individual EU and non-EU countries that have a reputation for high-quality in the honey market. Given this evidence, the major demand-side argument behind high consumer price premiums for defined origins appears to be food-safety related concerns. Thus, foreign suppliers will gain from international honey trade with Germany in different ways, depending on their reputation for quality. The magnitude of price premiums is surprisingly stable across different years, as are online prices of honeys that belong to the “core” assortment. Changes in the depth of the assortment, such as non-price competition, rather than price adjustments clear the market.

JEL Classification
Q13: Agricultural Markets and Marketing; Cooperatives; Agribusiness
L15: Information and Product Quality; Standardization and Compatibility
L66: Food; Beverages; Cosmetics; Tobacco; Wine and Spirits
Keywords: Fairtrade | Hedonic Price Analysis | Origin | Organic Production
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