Is local produce more expensive? Challenging perceptions of price in local food systems

ABSTRACT

This research examines price in local food systems to identify whether the perception that local is more expensive is justified. This study seeks to contribute to the field by addressing the dearth of quantitative price and availability research and building upon existing empirical research by considering a broader range of distribution channels and organic produce. Without a stronger understanding of pricing structures and distribution models, local food initiatives are based on assumptions rather than evidence. Using a case-study approach of the Region of Waterloo (Ontario, Canada), price and product data were collected at 11 outlets over a 6-month period. The study involved regression analysis of six locally produced fruits and vegetables based on local, Ontario, and organic attributes associated with the products and comparison with consumer willingness-to-pay research. Results show that local produce in the case study is not consistently more expensive than the non-local option. Both price discounts and premiums are found, depending on the product. These findings challenge the “local is more expensive” assumption and support suggestions that local food systems can be spaces for social inclusion. The organic attribute is associated with a price premium in all cases and may create confusion among consumers given frequent overlap between the local and organic attributes. Proponents of local food can use the results of this study to inform programme and policy development. Most notably, the study suggests that education around the distinction between local and organic as well as challenges to the price perception could be of benefit.

KEYWORDS:

• Local food
• pricing
• willingness to pay
• economic development
• consumer
• Ontario

Acknowledgements

The authors would like to express their appreciation to Chris Tang Yiqin and Ethan Ding and Dawn Smith for their research contributions to this paper.

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Funding

Financial support for this research was received from the Social Sciences and Humanities Research Council of Canada, the Government of Ontario, and the University of Waterloo.