We investigate if consumers value sustainable production of goods by measuring the increase in their willingness to accept (WTA) for backpacks, when they are either informed about sustainability aspects in the production or not, using the incentive compatible Becker-DeGroot-Marschak auction (BDM) (Becker, DeGroot, & Marschak, 1964). Participants are given a backpack that they can immediately sell back in two BDM auction rounds. After inspecting the backpack, participants state their minimum selling price in a first pre-treatment auction round. Then, depending on the treatment, participants receive different information about the backpack. In the control treatment, participants are given information about functionality and wearing comfort of the backpack, e.g. being water-repellent. In the sustainability treatment, participants are additionally informed that the production of the backpack was socially and environmentally sustainable. In a second post-treatment auction round, they are then again asked to state their minimum selling price. Subsequently, a number is randomly drawn to be the price. If participants’ bid is higher than the price, they keep the backpack. If their bid is equal to or lower than the price, they must sell the backpack at the drawn price.
The experiment is conducted at university campuses in Cologne. The experimenter asks people that pass by the experimenter’s stand if they want to participate in a consumer survey that is conducted by the University of Cologne. They are told that, if they are drawn in a lottery, they can win a backpack or money. If they agree to participate, they are randomly allocated to either the control or the sustainability treatment. Then, participants are given detailed written instruction that are read aloud to them by the experimenter. To test and enhance participants’ comprehension of the method, one training round with an apple is conducted. Then, participants make their pre-treatment bid. The backpack is available at the experimenter’s stand for participants to inspect. Afterwards, depending on the treatment, participants receive one of two different informational sheets about the backpack, either with or without sustainability related information. Then, participants make their post-treatment bid. In the end, participants answer various questions: They are asked if they know the brand (yes/no) and its CSR activities (5 point Likert scale), if they like the design (5 point Likert scale), about their current need of a backpack (5 point Likert scale) and how well they know the backpack market (5 point Likert scale). Then, they are asked to answer demographical questions about gender, age, vocational situation, field of studies and highest educational degree. Finally, they are asked if they usually buy socially and environmentally sustainable clothes and accessories (2 questions: 5 point Likert scale) and if they have paid more in the past for clothes and accessories that were produced socially and environmentally sustainably (2 questions: 5 point Likert scale). Participants that are allocated to the sustainability treatment are asked additionally if they know Fair Wear Foundation and bluesign (2 questions: yes/no).