Consumers’ Willingness to Pay for Liquid Milk in Sri Lanka
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The purpose of this paper is to estimates consumer willingness to pay (WTP) for liquid milk in Sri Lanka. Data were gathered through structured questionnaires conducted with 391 respondents in 9 provinces in Sri Lanka. Exploratory factor analysis was adopted to extract the main factors of consumers’ perception and motivation regarding liquid milk. Furthermore, the double-bounded dichotomous contingent valuation method was used to estimate the mean WTP and the factors that affect the consumers’ WTP for liquid milk, that is, raw and pasteurized milk. The findings showed that consumers were willing to pay Rs.81.41/litre and Rs.153.54/litre for raw milk and pasteurized milk, respectively. Additionally, consumers who were female, increasing in age and number of family member were more likely to pay more for raw milk. On the other hand, male consumers with high education level and high perception of health and convenience were more willingness to pay for pasteurized milk. Consumerswho had fewer children in their household and were price-conscious consumers raised consumers’ WTP for raw and pasteurized milk.
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