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Abstract

This study investigates the possibility of using local food banks as a distributor in the local food supply chain. A mixed logit model is used to estimate the price premium consumers are willing to pay at retail outlets for locally grown products, if consumers have knowledge that a portion of the purchase price will be used as a donation to support local food banks. Estimates reveal that average households are willing to pay 11.68% ($0.17/lb) more for locally grown produce relative to non-locally grown, and 10.75% ($0.33/lb) more for locally produced animal products. When the locally grown product attribute is combined with a food bank donation the WTP premium increases to 22.33% ($0.33/lb) for produce and 20.50% ($0.64/lb) for animal products. Consumers are only willing to pay a small price premium for products that contain the donation attribute but are not locally grown. However, a strong complimentary relationship was found between the local and donation attribute which suggest consumers have a stronger preference to donate when purchasing locally grown products than when purchasing nonlocal products.

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