Within the standardized method hedonic price analysis has several
advantages in the scope of defining priorities in breeding for quality.
One of the principal advantages is that hedonic price analysis yields ob-
jectively measurable quality characters that can be directly used as cri-
teria for selection. This is due to the fact that, unlike direct survey
methods, hedonic price analysis can easily detect consumer preferences
not only for evident traits but also for invisible, so-called cryptic traits.
With an interview or organoleptic tests one would only find out that a
certain variety is very “good for cooking” or “has a good taste.” How-
ever, these approaches would not directly reveal that traits such as pro-
tein content or hardness are also significantly determining consumer
preferences, as it is often the case (e.g., for sorghum in India, beans in
Mexico, wheat and barley in the U.S.; Wilson, 1984; Uri et al., 1994;
von Oppen and Parthasarathy Rao, 1982; Jiménez-Portugal, 1991).
Furthermore, several quality characteristics have a nonlinear rela-
tionship to consumer preferences, such that the initially positive effect
may turn negative once the trait exceeds a certain amount (e.g., fat con-
tent or grain size). With the hedonic price analysis the optimum amount
of such traits can be determined while this would be more complicated
to detect by direct survey methods. The quality traits identified to be rel-
evant for consumer preferences and their corresponding weights, as es-
timated by the hedonic price analysis, can be also combined in an
economic index for the expected preference of a new variety (von Oppen
and Parthasarathy Rao, 1982).
BACKGROUND OF THE HEDONIC PRICE ANALYSIS
Frederic Waugh formulated the hedonic price analysis as early as 1928
based on the observation that the different lots of tomatoes, asparagus
and cucumbers in the vegetable Market in Boston, Massachusetts,
showed considerable variations in price. Waugh tried to identify those
quality traits that were significantly influencing daily market prices
(Waugh, 1928). Since the early sixties, the hedonic price analysis has
found increasing acceptance in the literature on food quality assessment.
Most likely the rigor of its theoretical background and the statistical un-
biasedness of results make it an attractive tool for economists (Griliches,
1990; Triplett, 1990). The possibility of deriving objectively measurable
quality characteristics relevant for consumer preferences and the ad-
vantage of requiring relatively small quantities of sample material for
testing are rendering this method especially interesting for breeders and
Background of the Hedonic Price Analysis 53