Household Preferences and Willingness to Pay for Pesticides free Fruit in Khyber Pakhtunkhwa (KP), Pakistan

Abstract

The over use of fertilizers and pesticides in agriculture are degrading natural ecosystem and human health. The substantial association of health risk with pesticide residues and its adverse impact on environment has fetched attention of researchers across the globe. In this alarming scenario, pesticide free farming is deemed as panacea to environmental, human and animal health friendly production system. Pesticide free fruit are considered to be superior in quality as compared to fruit produced conventionally and helps in preventing several health and environmental hazards. Therefore, the demand for pesticide free fruit is increasing throughout the world. Given this increasing demand for pesticide free fruit, this study is designed to measure what price premium household would be willing to pay (WTP) for fruit free from pesticides such as apple, peach, and mango. This study also aims to identify factors influencing households‘ WTP decision of pesticide free fruit in Khyber Pakhtunkhwa (KP), Pakistan. The primary data was gleaned from 1000 sampled respondents through face to face interview from two selected districts namely Peshawar and Mardan KP, Pakistan. To elicit household‘s WTP information, Contingent Valuation Method (CVM) was employed. Contingent valuation is a survey based method used for eliciting willingness to pay of the households‘ for environmental and natural resources. Different elicitation techniques are used to design CV question scenario, such as payment card question, double dichotomous choice question and open ended question. Consequently, this study used the entire three payment format to elicit household‘s WTP for pesticide free fruit. The ordered logit model was employed to appraise the payment card method. However, linear regression model was adopted to identify factors influencing household‘s willingness to pay for pesticides free fruit. Nevertheless, the double bounded dichotomous choice model was performed to measure dichotomous choice questions. The major results demonstrate that 93.5 percent households were willing to pay higher prices for fruit pesticides free in the study area. Estimates remarkably reveal that around 35 percent households were willing to pay 16 to 20 percent higher prices and 24 percent households were willing to pay 6 to 10 percent higher prices for pesticides free fruit than the prevailing prices of conventional produce. It is reported by 61 percent of the households that local farmers use irrational pesticides on fruit. Major findings have also corroborated that 88.1 percent sampled household have perceived health concerns over pesticides residues in food. Similarly, 91.1 percent of the households have supported the idea that farmer should be engaged in environmental benign agricultural production practices which have a minimum adverse impact on health and the environment. Socio economic and demographic traits have confirmed positive significant effects on household‘s willingness to pay. The results of household‘s head awareness on WTP are according to the prior expectations that awareness of household‘s head has significant contribution in willingness to pay for pesticides free fruit. While household‘s size has a significant but inverse effect on willingness to pay for pesticides free fruit. Furthermore, household‘s perception regarding health and environment concern has a propensity to positively influence the willingness to pay for pesticides free fruit. It is also depicted by the results that mean WTP by using double dichotomous, payment card and open ended elicitation format validates consumer demand for pesticide free fruit in the study area. Three separate mean WTP were computed for each double dichotomous choice, payment card and open ended format which were figured as Rs.25.76, 16.32 and 14.37 respectively. These results reveal market potential for pesticides free fruit in the study area. This research study is expected to contribute in the three different aspects. Firstly, this study has figured out the potential for pesticides free markets in Pakistan. This study has also abridged the research gap regarding consumer‘s preferences and willingness to pay for pesticides free fruit which can be generalized and replicated to other areas. In addition, results have provided insight to fruit producers helping them to strategize production system decisions. Based on the findings from this research, government, nongovernment organization and other stakeholders should formulate policies and would promote and encourage the production of pesticides free fruit in Pakistan.