Decomposing local: a conjoint analysis of locally produced foods.

On the other hand, the farm size cue, though significant and positive for both models, induced a more varied response between the two groups. The WTP for this feature was more than two times larger for direct market shoppers than grocery store shoppers with no overlap in the 95% confidence intervals, indicating a much stronger degree of preference among direct market shoppers for produce that bore the Fred's Berry Farm name relative to Berries, Inc. However, for both subsamples, the value placed on farm affiliation was significantly smaller than that placed on either freshness or localness of production, suggesting that farm organizational issues have less significant impact on the preferences of the sample included in this study. Alternatively, respondents may hold strong preferences for farm affiliation, but the use of Fred's Berry Farm and Berries, Inc. may not have adequately relayed the concept to respondents. As one anonymous reviewer suggested, respondents may be suspicious that monikers such as Fred's Berry Farm are part of a corporate marketing scheme that may try to relay an anticorporate image.

One interaction term among product attributes proved to be robust and was included in the final model: an interaction of unknown location and identification with Fred's Berry Farm. The estimated coefficients were negative and statistically significant in both models. Thus, both groups of consumers were less likely to select the product from Fred's if its domesticity was not assured.

To incorporate the influence of demographic variables, interaction terms between selected consumer characteristics and product attributes were included. Only one of these estimates was significant at the 0.10 probability level. Male direct market shoppers in our sample showed stronger preferences for locally grown products than females.

Conclusions

Our results suggest that consumer demand does indeed exist for locally produced foods and that this demand is independent of other attributes that are often naturally associated with locally produced foods such as greater freshness and affiliation with "less corporate" production and marketing entities. Furthermore, we found that respondents failed to distinguish between products marked as "produced nearby" and "produced in Ohio," suggesting that state boundaries may serve as a natural point of geographic delineation for "local" production in the minds of consumers.

Although provocative, these results raise several interesting questions that cannot be addressed within the current experimental design and with the current sample of consumers. One would desire to verify that other ways of describing "local" production (i.e., below the level of within the state) did not spawn considerably higher levels of WTP. For example, one might imagine that the use of the village or county of production within a state could engender stronger values than our chosen phrase "grown nearby." If this were the case, it may argue that states or other entities are leaving value on the table by not further differentiating products beyond a simple claim that a product is made within the state.

Furthermore, although state boundaries appear to coincide with respondent visions of "local" production for this sample of respondents, we must keep in mind that this sample was drawn from a single, medium-sized, Midwestern state. This begs the question: Would consumers in a state with a much larger or smaller geographical extent (or a medium-sized state with vastly different growing regions), similarly treat state boundaries as a point of demarcation for local production? In New England, for example, one might imagine consumers identifying product from one of several states as local, although northern Californians may not consider southern Californian production as local. Achieving such regional clarity on this matter would require further regionalized studies.

If further studies suggest that state boundaries do prove a relevant point of demarcation for "local" production in the minds of consumers, this opens up a great opportunity for producers to more fully harness existing state programs that verify and label production as occurring in that particular state and for states to generate greater benefits from existing bureaucratic structures.

[Received September 14, 2006; accepted August 3, 2007.]

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(1) Based on the authors' survey of 50 state agricultural department's websites during August 2006.

(1) Based on the authors' survey of 50 state agricultural department's websites during August 2006.

(2) Farmers' markets refer to open-air markets with multiple stalls representing a variety of farm and/or marketing operations. Farm markets refer to either indoor or outdoor venues where a single farm operation is selling goods

(3) The specific protocol for approaching potential participants was to approach the first person to enter the section of the facility in which the interviewer was located once the interviewer had all interviewing materials prepared. Upon refusal by a potential respondent or completion of the interview, the same procedure was repeated. When several potential participants entered at the same time, the interviewer favored potential respondents that differed from the previous respondent with regard to age, gender, or race.

(4) This procedure is referred to as creating Pareto optimal stimulus sets (see Krieger and Green 1988, and Wiley 1977). Huber and Hansen (1986) showed that using Pareto optimal stimulus sets improved predictive ability of the estimated preference model.

(5) In our definition we use the narrow term "farm size," understanding that the attribute represents a more inclusive concept of the small-scale, family farm that offers an appeal closely parallel to that which "locally grown" may communicate.