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Valuing Consumer Preferences with the CUB Model: A CaseStudy of Fair Trade Coffee

International Journal on Food System Dynamics

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Field Value
 
Title Valuing Consumer Preferences with the CUB Model: A CaseStudy of Fair Trade Coffee
 
Creator Cicia, Gianni
Corduas, Marcella
Del Giudice, Teresa
Piccolo, Domenico
 
Subject CUB model; fair trade coffee; latent class choice model
 
Description D'Elia and Piccolo (2005) have recently proposed a mixture distribution, named CUB, for ordinal data. The use of such a mixture distribution for modelling ratings is justified by the following consideration: the judgment that a subject expresses is the result of two components, uncertainty and selectiveness. The possibility of relating the parameters of CUB models to covariates makes the formulation interesting for practical applicationsIn this case study, a sample of 224 fair-trade coffee consumers were interviewed at stores. With this data-set, CUB model split consumers, according to their preferences, in two different segments: one showing high price elasticity, and one with a low price elasticity. As regards the potential of the CUB model, it showed a considerable integration capacity with stochastic utility models, namely latent class models. Indeed, by using the segmentation factors emerging from the CUB as covariates of segmentation in a latent class model and setting the number of classes equal to those emerging from the CUB, it was possible to estimate a model which not only validated the findings of the CUB but also allowed estimation of the WTP for the fair trade characteristic in the different groups.
 
Publisher CentMA
 
Contributor —
 
Date 2010-03-15
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
—
 
Format application/pdf
 
Identifier http://centmapress.ilb.uni-bonn.de/ojs/index.php/fsd/article/view/119
10.18461/ijfsd.v1i1.119
 
Source International Journal on Food System Dynamics; Vol 1, No 1 (2010); 82-93
1869-6945
 
Language eng
 
Relation http://centmapress.ilb.uni-bonn.de/ojs/index.php/fsd/article/view/119/12