Consumer willingness to pay for bio-based products. Do certifications matter?

European Commission aims to promote a more efficient and harmonized policy regulation framework for the market-pull of bio-based products. We conduct an artefactual field experiment in Italy, that demonstrates the existence of a “green premium”, which refers to increased consumer willingness to pay (WTP) for bio-based over conventional products, and a “certified green premium”, which refers to an additional increase in consumer WTP for certified bio-based products over and above other bio-based products. This experiment measures consumer preference through an incentive compatible procedure using 1080 observations. Moreover, we show that, across different product typologies (i.e. hand soap, food bags, colored pens), demand for conventional products is generally more elastic than demand for bio-based and certified bio-based products. Our evidence underlines that certification may play a key role in purchase decision making, especially for products in the food and nutrition and personal care categories. The diffusion of certified bio-based products may therefore prove effective for overcoming economic challenges related to the implementation of the circular bioeconomy. Social involvement is necessary to make certification an informative tool for consumers to encourage them to make green purchases. In fact, bio-based products combined with proper management at the end of their life cycle represent the concept of a circular bioeconomy. Certification therefore becomes the visible output to consumers of the actual sustainability of these products. Furthermore, the higher demand elasticity of conventional products suggests that even moderate price increases may have a significant impact on consumer preference for more sustainable products.