Assessing Haitian Consumers' Willingness to Pay a Premium for Aflatoxin-Compliant Peanut Butter in the Informal Market

Abstract

Market-based solutions are increasingly tested to address aflatoxin issues in peanuts in developing countries. Although previous studies have found that Haitian grocery store shoppers are willing to pay a 21% premium for peanut butter with levels of aflatoxin that meet international standards, no information is available for the much larger informal market. A stated preference survey, using an iterative bidding process, was conducted among 585 informal market consumers of Port-au-Prince and Cap-Haitien, the two largest cities in Haiti. Results show that informal market participants are willing to pay a 12% premium for peanut butter that meets international aflatoxin standards. Based on the result of a previous revealed preference study on Haitian peanut farmers, the observed premium would be largely sufficient to incentivize farmers to adopt aflatoxin mitigation practices, which supports market-based solutions to improve the safety of a Haitian staple food. Results also indicate that informal market consumers have greater confidence in a certification from an international institution rather than a domestic one.