Consumers' psychological reactions during a food safety incident and WTP for nano-sensors in meat products

Risk communication disseminated during a food safety incident plays an important role in shaping consumer purchasing behaviour. Consumer research shows that immediately after a food safety incident the demand of indicted products falls rapidly and then starts to increase slowly when consumer confidence is restored. Another important aspect of risk communication is to understand how messages influence the magnitude of consumers' perceived risk and how this element can affect food purchasing behaviour. However, very little is known about the cognitive process that consumers undertake when markets are shocked by food scares and how perceived risk influence consumers' choices. In order to fill such a gap this study aims at understanding how people react and behave in food markets with and without a food safety incident caused by E. coli in meat products. To achieve this objective models of social psychology and economics were combined to assess how consumers' subjective probability (De Finetti's theorem on exchangeability) and psychological reactions (Protection Motivation Theory) impact on willingness to pay (WTP) of hypothetical meat products packaged with nanosensors. WTP for these products was elicited both by means of a payment card and a stated choice experiment and estimated respectively with a Tobit regression and a scale adjusted latent class model. The survey was administered in the UK between February and March 2015 and 627 respondents in the UK took part in the study. Results show that risk overestimated attitude in risk markets is influenced by sociodemographic and economic characteristics of respondents. Psychological elements and subjective probability have also different impacts in the simulated market scenarios of risk and no risk In particular, WTP for meat packaged with nanosensors varies under different psychological reactions and subjective probability fits well the identification of latent classes and consumers' choices. Marketing and policy implications of these findings are discussed.