What Are Consumers Willing to Pay for Improved Milk Quality in Moyale, Kenya?
Research Brief 08-01-PARIMA. Global Livestock Collaborative Research Support Program
University of California at Davis
Pastoralists in northern Kenya and southern Ethiopia may be able to diversify income by selling milk to urban residents. However, milk sold in open-air markets is often low in quality because it has been transported long distances without refrigeration and is subject to spoilage, or because milk is adulterated prior to sale to boost volume or enhance appearance. Open-air markets are characterized by low-income consumers who must make choices about milk quality with virtually no information other than their own sensory perceptions. PARIMA researchers used an experimental-auction approach to determine what residents in Moyale, Kenya, are willing to pay (WTP) for improved milk quality. Researchers created milk samples that varied in taste and texture and asked participants to bid for them in order to reveal the value of their preferences. Results indicate that consumers are indeed willing to pay for improved milk quality. For example, compared to younger women, older women would pay a 20% premium for higher-quality milk. Furthermore, poorer consumers would pay a 19% premium simply for assurances on milk safety. These findings indicate that there are economic incentives to enhance milk quality and justify attention to basic technical and/or organizational interventions that could improve the quality of milk marketed to the residents of this border town.
Wayua, F., M. Shibia, M. Mamo, D. Bailey, and D.L. Coppock 2008. What are consumers willing to pay for improved milk quality in Moyale, Kenya? Research Brief 08-01-PARIMA. Global Livestock Collaborative Research Support Program, University of California, Davis. 3 pp.