Limits...
A stated preference investigation into the Chinese demand for farmed vs. wild bear bile.

Dutton AJ, Hepburn C, Macdonald DW - PLoS ONE (2011)

Bottom Line: The ability of farmed bear bile to reduce demand for wild bear bile is at best limited and, at prevailing prices, may be close to zero or have the opposite effect.This means that the incumbent product may actually sell more items at a higher price when competing than when alone in the market.For the wildlife farming debate this indicates that at some prices the introduction of farmed competition might increase the demand for the wild product.

View Article: PubMed Central - PubMed

Affiliation: Wildlife Conservation Research Unit, Department of Zoology, The Recanati-Kaplan Centre, University of Oxford, Oxford, United Kingdom. adam.dutton@zoo.ox.ac.uk

ABSTRACT
Farming of animals and plants has recently been considered not merely as a more efficient and plentiful supply of their products but also as a means of protecting wild populations from that trade. Amongst these nascent farming products might be listed bear bile. Bear bile has been exploited by traditional Chinese medicinalists for millennia. Since the 1980s consumers have had the options of: illegal wild gall bladders, bile extracted from caged live bears or the acid synthesised chemically. Despite these alternatives bears continue to be harvested from the wild. In this paper we use stated preference techniques using a random sample of the Chinese population to estimate demand functions for wild bear bile with and without competition from farmed bear bile. We find a willingness to pay considerably more for wild bear bile than farmed. Wild bear bile has low own price elasticity and cross price elasticity with farmed bear bile. The ability of farmed bear bile to reduce demand for wild bear bile is at best limited and, at prevailing prices, may be close to zero or have the opposite effect. The demand functions estimated suggest that the own price elasticity of wild bear bile is lower when competing with farmed bear bile than when it is the only option available. This means that the incumbent product may actually sell more items at a higher price when competing than when alone in the market. This finding may be of broader interest to behavioural economists as we argue that one explanation may be that as product choice increases price has less impact on decision making. For the wildlife farming debate this indicates that at some prices the introduction of farmed competition might increase the demand for the wild product.

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Related in: MedlinePlus

A set of estimated demand functions for wild bear bile.For each function farmed bear bile is held at ¥90 per treatment and these are the results under the “serious” scenario. The CV demand function presents demand in the absence of farmed bear bile whilst the others describe two possible functions when competing with farmed bear bile.
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pone-0021243-g002: A set of estimated demand functions for wild bear bile.For each function farmed bear bile is held at ¥90 per treatment and these are the results under the “serious” scenario. The CV demand function presents demand in the absence of farmed bear bile whilst the others describe two possible functions when competing with farmed bear bile.

Mentions: Here we define the prices at which introducing farmed bear bile to the market would be predicted to have no effect in the scenario presented. Setting the farmed price at ¥30 (the lower end of the 95% confidence interval for the average price) the BL model is equal (in total demand) to the Contingent Valuation (CV) model at ¥283.2 for wild bile. That is to say that at this price the BL model predicts no change in demand when farmed bile is and is not available. At this price the cross price elasticity for wild bear bile is 0.13 (calculation of the elasticities is presented in Text S1) indicating that at this point a change in the price of farmed bear bile would have little impact upon the consumption of wild bile. Elasticity of less than 1 indicated inelasticity. This means that a change in price will have little impact upon demand. The Log Linear (LL) model intersects the CV model at ¥871 (cross price elasticity = 0.18). Setting the farmed price at ¥90 the BL model is equal to the CV model at ¥201.2 (cross price elasticity = 0.03); the LL model intersects the CV model at ¥310.2 (cross price elasticity = 0.16). At starting prices above these values the models predict that the public would demand more wild bile, when offered the choice of farmed bear bile, if the price of wild bile either drops or stays the same (see figures 1 and 2).


A stated preference investigation into the Chinese demand for farmed vs. wild bear bile.

Dutton AJ, Hepburn C, Macdonald DW - PLoS ONE (2011)

A set of estimated demand functions for wild bear bile.For each function farmed bear bile is held at ¥90 per treatment and these are the results under the “serious” scenario. The CV demand function presents demand in the absence of farmed bear bile whilst the others describe two possible functions when competing with farmed bear bile.
© Copyright Policy
Related In: Results  -  Collection

Show All Figures
getmorefigures.php?uid=PMC3140486&req=5

pone-0021243-g002: A set of estimated demand functions for wild bear bile.For each function farmed bear bile is held at ¥90 per treatment and these are the results under the “serious” scenario. The CV demand function presents demand in the absence of farmed bear bile whilst the others describe two possible functions when competing with farmed bear bile.
Mentions: Here we define the prices at which introducing farmed bear bile to the market would be predicted to have no effect in the scenario presented. Setting the farmed price at ¥30 (the lower end of the 95% confidence interval for the average price) the BL model is equal (in total demand) to the Contingent Valuation (CV) model at ¥283.2 for wild bile. That is to say that at this price the BL model predicts no change in demand when farmed bile is and is not available. At this price the cross price elasticity for wild bear bile is 0.13 (calculation of the elasticities is presented in Text S1) indicating that at this point a change in the price of farmed bear bile would have little impact upon the consumption of wild bile. Elasticity of less than 1 indicated inelasticity. This means that a change in price will have little impact upon demand. The Log Linear (LL) model intersects the CV model at ¥871 (cross price elasticity = 0.18). Setting the farmed price at ¥90 the BL model is equal to the CV model at ¥201.2 (cross price elasticity = 0.03); the LL model intersects the CV model at ¥310.2 (cross price elasticity = 0.16). At starting prices above these values the models predict that the public would demand more wild bile, when offered the choice of farmed bear bile, if the price of wild bile either drops or stays the same (see figures 1 and 2).

Bottom Line: The ability of farmed bear bile to reduce demand for wild bear bile is at best limited and, at prevailing prices, may be close to zero or have the opposite effect.This means that the incumbent product may actually sell more items at a higher price when competing than when alone in the market.For the wildlife farming debate this indicates that at some prices the introduction of farmed competition might increase the demand for the wild product.

View Article: PubMed Central - PubMed

Affiliation: Wildlife Conservation Research Unit, Department of Zoology, The Recanati-Kaplan Centre, University of Oxford, Oxford, United Kingdom. adam.dutton@zoo.ox.ac.uk

ABSTRACT
Farming of animals and plants has recently been considered not merely as a more efficient and plentiful supply of their products but also as a means of protecting wild populations from that trade. Amongst these nascent farming products might be listed bear bile. Bear bile has been exploited by traditional Chinese medicinalists for millennia. Since the 1980s consumers have had the options of: illegal wild gall bladders, bile extracted from caged live bears or the acid synthesised chemically. Despite these alternatives bears continue to be harvested from the wild. In this paper we use stated preference techniques using a random sample of the Chinese population to estimate demand functions for wild bear bile with and without competition from farmed bear bile. We find a willingness to pay considerably more for wild bear bile than farmed. Wild bear bile has low own price elasticity and cross price elasticity with farmed bear bile. The ability of farmed bear bile to reduce demand for wild bear bile is at best limited and, at prevailing prices, may be close to zero or have the opposite effect. The demand functions estimated suggest that the own price elasticity of wild bear bile is lower when competing with farmed bear bile than when it is the only option available. This means that the incumbent product may actually sell more items at a higher price when competing than when alone in the market. This finding may be of broader interest to behavioural economists as we argue that one explanation may be that as product choice increases price has less impact on decision making. For the wildlife farming debate this indicates that at some prices the introduction of farmed competition might increase the demand for the wild product.

Show MeSH
Related in: MedlinePlus