Institute of Food Economics and Consumption Studies

Consumer Behaviour Concerning Functional Foods

Functional foods as a marketing term was initiated in Japan in the late 1980s and is used to describe foods fortified with compounds or ingredients capable of generating health benefits. This concept has become more and more popular with consumers because of a growing awareness of the relation between healthiness, nutrition, and diet. Functional food ingredients include for example probiotics, prebiotics, vitamins, and minerals and are found in such diverse products as fermented milk and yoghurt, sports drinks, baby foods, sugar-free confectionery, and chewing gum. 

In Europe, Germany represents one of the most important countries within the functional food market. Although the market share of functional food is below 1% of the total food and drinks market, market estimations assume an increase of 5% in Europe until 2013.  In Germany in the years 1999 and 2000 19% of all innovations in the total food and drinks market were traced back to functional foods. Furthermore, 20% of these functional food innovations have been functional dairy products. Hence, besides soft drinks dairy products play an important role with regard to functional food innovations. Due to this development it is of major interest for food policy and industry to investigate empirically demand, determinants of demand as well as consumers’ preferences and willingness to pay for functional dairy foods.

The study will conduct a survey in Germany where a stated choice experiment is used to examine acceptance of and willingness to pay for functional dairy products. Only a few authors have analysed willingness to pay for functional foods using choice experiments. None of the studies attempted to focus on dairy products even though the most active area within the functional foods market in Europe are probiotic dairy products, particularly, probiotic yoghurts and milks. The present study does not only contribute to the growing literature by employing the choice experiment methodology regarding the acceptance of functional foods, but it also pushes it to the next level applying it in the context of dairy products.

This study takes place within ‘Food Chain Plus’ (FoCus) – a project at the Christian-Albrechts-University of Kiel which analyses the food supply chain along the entire process chain. FoCus integrates the preventive approach of food science research and it develops innovative concepts in relation to the food supply chain. There are four cooperative projects within FoCus: production of milk and efficiency of resources, feeding and animal health, genetic variability and functional milk compounds, evaluation of health effects and consumer behaviour.

Kompetenznetzwerk “FoCus – Food Chain Plus”: Forschung in der Wertschöpfungskette Milch

The impact of macroeconomic policies and trade on food security, nutrition and health

During the 1960s and 1970s it has been typical for governments of developing countries to isolate domestic markets from world markets through specific mechanisms such as direct tax and subsidies or quantitative restrictions. The main aim was to protect domestic sectors that would not have been able to successfully compete in world markets from foreign competition. During the 1980s and 1990s, however, many developing countries initiated policy reforms under structural adjustment programs of the World Bank and the International Monetary Fund. The rationale for trade liberalization is couched in terms of its presumed favorable effect on economic growth mainly through induced efficiency gains in the allocation of resources. Although trade liberalization may not be the most powerful or direct mechanism for addressing poverty, it is one of the easiest to implement. 

Trade reform involving tariff reductions and the abolition of non-tariff barriers may be one of the most effective anti-poverty policies available for governments. However, whether trade liberalization promotes economic growth and improves overall social welfare remains a controversial issue. Apart from its effect on GDP per capita growth, which has been extensively studied, a case in point which deserves further attention is the impact of trade liberalization on poverty and food security. The analysis of food security impacts of trade liberalization policies is crucial and helps to facilitate better targeted country-level research and reforms. Inadequate nutrition results in human and economic waste. 

In developing societies, substantial deaths are thought to be malnutrition-related, and large proportions of the population face the negative effects that inadequate diet and related illness have on learning, work capacity, behavior and well-being. Trade policy influences national food security trough both its effect on domestic production and imports, and also through the link with incomes and expenditures. However, only very few studies explicitly explore the impact of globalization on food security in developing countries.

The present study will employ a dynamic panel data approach to assess the overall (average) effect of globalization on poverty and food security in developing countries. Cross-sectoral and cross-country analysis helps strengthen the understanding of why people are food insecure, malnourished or hungry. The main objective of the current study is thus to gain insight into the issue of whether trade liberalization generally promotes growth and creates or alleviates poverty and food insecurity. Instead of applying random or fixed-effects OLS, which give rise to `dynamic panel bias’, the present study will employ the Generalized Method of Moments (GMM) procedure which accounts for both unobserved heterogeneity and endogeneity of the regressors and enables us to account for some of the dynamic aspects of trade reforms other approaches miss. The Difference and System GMM estimators are specifically designed for panel data analysis. Macroeconomic and structural variables should be considered as control variables. For example, inflation lowers purchasing power and may raise poverty or decrease food security.


Beginn: 01.08.2009
Projektleitung: Prof. Dr. Awudu Abdulai
Bearbeitung: Dipl.-Volskw. Jan Dithmer


Trust as a Determinant of Consumer Behaviour for Organic Food Consumers in Germany

Organic farming follows an organisational principle by reaching a closed nutrition cycle with a focus on food quality and safety in the long-term, nature conservation and sustainability. Organic agriculture is an efficient and holistic approach that reaches the multiple goals of agriculture by promoting soil conservation (e.g. soil fertility), prevention of water pollution (e.g. lack of nutrients in ground- and surface waters), protection of species (e.g. biodiversity), and –species-appropriate animal husbandry (e.g. adequate run-out). The exclusion of genetically modified organisms is a necessity.

Consumer trust analysis from different point-of-sale sources indicated that organic butchers (49 %), organic food shops (46 %), and organic bakers (45 %) were the most trustworthy suppliers for organic foods that met compliance standards from the consumers’ point of view, while discounters were the least trusted (8 %). Hence, the transaction volume of discounters declined about 6 %, while organic and health food markets increased 5.2 % in the first half of 2009. Due to this development, this study will investigate reasons and problems associated with purchase decisions for organic food consumers. 

Most studies from previous research explored subjective perceptions of quality attributes, consumer uncertainty and consumer risk perceptions and/ or quality information gaps between producers and consumers. However, these studies were not focused on specific organic food product markets in Germany. Hence, this study will conduct surveys in Germany using a stated choice experiment that examines the trust impact on organic product purchase decisions (organic milk, organic fruits and vegetables, organic meat). Next to the element of trust, other factors that influence organic product purchase decisions are exogenous factors such as regulations, certifications, labelling, information, awareness and knowledge. Knowledge about credence goods as organic foods is limited; therefore, the consumer decision at purchase is a decision under uncertainty. Consumer awareness and knowledge about organic foods next to the psychometric (cognitive, normative, affective) factors, socio-demographic and socio-economic variables (e.g. age, sex, income, education and the number of children per household) have an effect on consumer attitude and perception. 

Results of this study will provide agri-food companies, the public sector, and researchers opportunities to develop new risk communication strategies for the long-term perspective that encompasses consumer trust as a contributing factor.


Beginn: 15.08.2009
Projektleitung: Prof. Dr. Awudu Abdulai
Bearbeitung: Rebecca Illichmann, MSc.