A Study on the Preference for the Defensive Attribute under Environmental Risk in China

Abstract

Little is known about the preference for defensive consumption goods and their defensive attributes under environmental risks in developing countries. The paper takes the water purifier as an example of defensive consumption goods against heavy metal pollution risk from drinking water. Using a survey data in China, the discrete choice experiment method is employed to investigate rural farmers’ preferences for a water purifier. The scientific knowledge and risk perception effects are used to determine farmers’ preferences for the defensive attribute on a water purifier. Using a mixed logit model, rural farmers are found to prefer a water purifier with low price, free installation, a longer warranty period, and a heavy metal filter (i.e., the defensive attribute). Farmers’ neighborhood norm perception dominates the defensive preference while scientific knowledge do not work significantly. More specifically, the more the neighborhood norm perception is recognized, the more likely farmers are to improve their own preferences for the defensive attribute. Affected by the neighborhood norm perception, rural farmers’ preferences for the defensive attribute are found to be increased significantly as average income gaps narrow. The future defensive health policies should be devoted to improving environmental risk awareness and utilizing informal social networks in areas with high environmental risks.