Interviewer Effects, Consumer Preferences, and Housing Bubble Identification : Three Essays in Applied Economics
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Research conducted in psychology and sociology has noted the observed bias in responses to face-to-face and telephone surveys based upon interviewer characteristics such as age, gender, and ethnicity (Curtin et al, 2005). While these studies have concentrated mostly on political opinion and fundraising, few have examined consumer preferences/attitudes towards food products. In the first essay, we analyze the impact of interviewer race, gender, age, personality, and perceived beauty on consumer willingness to participate in face-to-face surveys, as well as their willingness to pay for organic, natural, and conventionally produced meat products in the State of Nevada. In total, 4129 respondents were approached, 596 were surveyed, and 3533 refused to take the survey. Thirty-one interviewers were used, all differing in age, race, gender, etc. Responses were collected at two food festivals in Reno and Carson City, NV. We use a random effect Probit model to examine the impact of interviewer characteristics on consumer willingness to participate. Moreover, we also examine if beauty and personality have a significant effect on survey participation. The results of the present study illustrate the interviewer and respondent effects on participation in a consumer meat survey. Additionally, when aspiring to collect a representative sample, it will be important to incorporate interviewers with the characteristics most likely to recruit the required respondent types. In the second essay, the study focuses on how the general lack of knowledge among consumers concerning organic and natural products can be misleading and hence, indicates a need for a better understanding of how consumer pre-existing knowledge and new information regarding organic and natural products influence consumer purchasing behavior. In this study, we research the effect of providing consumers with information regarding organic and natural production processes in four separate stages on their willingness to pay (WTP) for various natural/organic meat products. Through the use of survey data collected in-person during the fall of 2007 Nevada, in which 597 surveys were completed, we examine the impact of consumer perceived knowledge of organic and natural grass-fed production processes on their WTP, whether or not new information/knowledge will modify their WTP, and the degree of modification across meat types and cuts. The purpose of our research is twofold. First, we wish to observe whether or not advertising and other promotional methods truly influence consumer demand and willingness to pay for these specialty meat products. These results will likely be important to the role of marketing and the way in which information is provided to consumers on organic and natural production methods and the potential positive effects of those methods. Additionally, the paper will show how consumers purchasing experiences and pre-existing knowledge might influence their reaction to the same information. The goal of the third essay is to shed light on the following question: Can we identify housing bubbles? The paper will focus on finding evidence that housing price has a pure price-momentum during a housing price bubble. The challenge is if we can find the evidence aside from the fundamentals to support the theory of "bubbles." We use an Arellano-Bond model to examine the correlation between fundamentals and housing price. Moreover, we examine the stationarity of housing prices and residuals. This provides us a different method in identifying the housing bubble. As a result, we observed that before 2000, housing prices can still be explained accurately by fundamental factors, while after 2000, housing prices depart from the demand and supply mechanism. In summation, the run-up price from 2000 is driven by price itself, people's expectations and speculative motivations, and other non-fundamental factors----in other words, a bubble.