Agricultural market information: How much and who is willing to pay for it?

Abstract

Access to an agricultural market information system (AMIS) is essential to reduce farmers' risk from market speculation related to information asymmetry. However, AMIS's sustainability depends on the users' needs and willingness to pay (WTP) for market information. This paper explores the WTP for market information among market‐oriented farmers, as well as its determinants. Data were collected through a structured survey with 479 farmers. A contingent dichotomous choice dual boundary estimation is used to measure WTP and a logistic regression is used to ascertain the main determinants of the stated WTP. Experienced losses, access to market information, use of non‐virtual means of information, and degree of farm specialization are the main determinants of the WTP. These findings are useful for establishing a feasible AMIS, and designing its services according to the characteristics, needs, capacities and preferences of the identified potential users.