Consumers’ Response to Food Fraud: Evidence from Experimental Auctions

Abstract

This study uses a laboratory valuation experiment to examine whether food fraud occurring in one country affects the valuation of products from that country as well as products from other countries. We use a between-subject experiment design to compare consumers’ valuation of extra virgin olive oil (EVOO) from different countries with and without exposure to information about olive oil fraud occurring in one of the countries. Results show that information about olive oil fraud in one country negatively affects the valuation of EVOO not only from that country but also from other countries, indicating negative spillover effects of food fraud.