Determinants of Willingness to Pay towards Malaysian Organic Food
Siddique Ahmed1, Chamhuri Siwar2, A. S. A. Ferdous Alam3, Basri Abdul Talib4, Norshamliza Chamhuri5, Nor Diana Mohd Idris6
1Siddique Ahmed, Institute for Environment and Development (LESTARI), Universiti Kebangsaan Malaysia National University of Malaysia, Selangor, Malaysia.
2Chamhuri Siwar, Institute for Environment and Development (LESTARI), Universiti Kebangsaan Malaysia National University of Malaysia, Selangor, Malaysia.
3A. S. A. Ferdous Alam, School of International Studies, Universiti Utara Malaysia, Kedah, Malaysia.
4Basri Abdul Talib, Faculty of Economics and Management, Universiti Kebangsaan Malaysia National University of Malaysia, Selangor, Malaysia.
5Norshamliza Chamhuri, Faculty of Economics and Managemen, Universiti Kebangsaan Malaysia National University of Malaysia, Selangor, Malaysia.
6Nor Diana Mohd Idris, Institute for Environment and Development (LESTARI), Universiti Kebangsaan Malaysia National University of Malaysia, Selangor, Malaysia.
Manuscript received on 08 May 2019 | Revised Manuscript received on 19 May 2019 | Manuscript Published on 23 May 2019 | PP: 1086-1090 | Volume-7 Issue-6S5 April 2019 | Retrieval Number: F11860476S519/2019©BEIESP
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© The Authors. Blue Eyes Intelligence Engineering and Sciences Publication (BEIESP). This is an open access article under the CC-BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/)
Abstract: Organic food market is very challenging in Malaysia. As the growth of this sector is consumer driven, a huge amount of studies conducted worldwide about consumer behavior towards organic food. The objective of this article is to investigate into the factors of consumers’ purchase decisions regarding organic food in Malaysia. Research dealing with various aspects of WTP and Actual Purchase were reviewed and an initial conceptual framework has been developed to carry out research objectives. Data have been collected from Federal Territory and Selangor State of Malaysia. Structural Equation Modeling was employed to measure factors and test the research hypotheses. Results shows that about 58% of the variances of WTP for organic food can be explained by health concern, affordability, subjective norms and convenience and WTP has a significant impact on Actual Purchase. Perception has no impact on individual’s willingness-to-pay for organic food. Based on these empirical findings a model for WTP and Actual Purchase has been proposed for organic food.
Keywords: Organic Vegetables and Fruits, Willingness-to-pay (WTP), Structural Equation Modelling (SEM), Malaysia.
Scope of the Article: Structural Engineering