Consumer Willingness to Pay and Economic Benefit Analysis for Sorghum-Pigeon Pea Flakes in Makueni and Busia Counties, Kenya
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Date
2023-07
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Publisher
Kenyatta Univesity
Abstract
Quality of food and extend of safety levels plus food availability are globally considered
as key facets to human development. Nutritious food, mostly comprising Carbohydrates
along with Proteins (energy providers and body builders respectively) is said to be an
essential requirement for human health and labour output. Of the three meals
recommended in the Intensive Behavioural Interventions (IBI) studies, breakfast
provides 20% of calories and on average about 20% daily proteins, total fats and
saturated fats as well as dietary fibre. Thus the main objective of the study was to
determine the highest amount of money consumers were willing to pay (WTP) for
sorghum-pigeon pea flakes,in Makueni and Busia counties in Kenya. The three specific
objectives were; i) to assess consumer awareness level, ii) to determine the highest
amount the consumers were willing to pay and iii) to determine the economic benefit
in consuming SPPF as a ready to eat breakfast cereal in Makueni and Busia counties,
Kenya. Sample size was determined using Glen (2013) formula and direct survey via
Contingent Valuation Method (CVM) was used on 223 consumers from the two
selected counties. Administration of semi-structured dichotomous questionnaire was
done to collect data on awareness and acceptance as well as on perceived economic
benefit of the Flakes within the two counties. The data collected were subjected to
statistical package for social studies (SPSS) for descriptive statistics (through cross
tabulation and chi-square) and STATA vs16 for regression through double bounded
logit model to assess the consumers” WTP for SPPF, finally economic benefit was
determined through price-demand model. The WTP assessment results for SPPF
revealed that, in both counties consumers were willing to pay for SPPF. In Busia and
Makueni Counties, the average WTP value was Kshs. 140 and 136, respectively. The
study too revealed that 50% of the respondents within the study area were aware of the
SPPF breakfast cereal towards improving consumers’ nutrition. The results of the
double-bounded logit regression revealed that gender, married, aware of SPPF and
living in Busia County had positive influence on WTP for SPPF. Furthermore, based
on the Economic Benefit analysis it was evident that there is EB in consuming SPPF of
Ksh. 475.00 in a given week. Consequently, the study recommends WTP applications
to obtain data-driven pricing decisions for new products such as SPFF fronted by farmer
groups. Secondly, policy makers should involve Consumers’ participation in policy
formulations and pricing strategies related to new products for its success. The research
work further adds to the existing knowledge of economics, creating job opportunities
and improvement of the nutritional health of the population in Makueni and Busia
counties.
Description
A Research Thesis Report Submitted in Partial Fulfilment of the Requirements for the Degree of Master of Science (Agribusiness Management and Trade) in the School Of Agriculture and Environmental Sciences of Kenyatta University July 2023