The power of information from a consumer perspective

The German Minister of Food and Agriculture initiated a mandatory state label for animal husbandry, revealing livestock production conditions. This study investigates consumer preferences and their willingness to pay price premiums for pork from different husbandry conditions. We tested the original label as well as a modification with additional information on the available living space for the animal, a modification with additional interpretive information (i.e. a colour scale indicating how a product scores on animal husbandry standards), and a combination of both. We conducted a representative online discrete choice experiment (n = 2,015) in Germany and analysed the data using a mixed logit model. Our results show that the label proposed by the government effectively increases the willingness to pay for meat produced with higher standards except the ‘organic’ level. We also show that indicating a ranking of husbandry conditions could further increase the willingness to pay.