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4. Hedonic price function in food products
The hedonic pricing method is a useful approach to assess the relationship of price and quality of a product. This method is important to analyze the
relationship between the prices and the product characteristics. From this analysis it can be seen the implicit price of a characteristic by reduce the regression function
of the attributes of a product. In general, the price of an item depends on the inherent characteristics of the goods Rosen, 1974.
Rice hedonic price analysis shows different results of many country, although there are some similarities. In general, consumers in Indonesia, the
Philippines and Thailand provide a higher price for higher grain heads and less foreign matter. Indonesia and Thailand rice consumers provide a higher price on
rice that is more translucent, while the price of rice in the Philippines are not affected by the translucent. Related to color rice, Indonesian consumers give a
higher price at a more white rice, while prices in the Philippines and Thailand were not affected by color. The opposite occurs in the hedonic price of amylose content,
Indonesian consumers give a higher price on rice with a higher amylose content, while the Philippines and Thailand consumers on rice with lower amylose content
Damardjati and Oka, 1992; Abansi et al ., 1992; Sriswasdilek et al., 1992.
5. Determinant of consumer preference to food
In general, consumers food preference is influenced by socioeconomic factors, demographic factors, and factors awareness and consumer awareness of
nutrition. The study shows that income Rimal, 2002 and education level Rimal, 2002; Storstad and Bjorkhaug, 2003 has a positive effect on consumer preferences
on meatless meals. Rimal 2002 stated that households of different states have different preferences on meatless meals, while the demographic factor that
influences the consumer preference is the composition of the family. This study
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results also showed that consumer concerns on food content of a destructive nature cholesterol for instance has more influence on consumer preference than the
concern for the useful content of the food vitamins for example.
6. Consumer demand for food
Demand function is a relationship between the amount of goods that consumers are willing to buy at a particular price range by maintaining other
factors are fixed Tomek and Robinson, 1990. In general, consumer demand for goods or services are determined by several important factors, i.e. the average
income, population size, price and availability of similar items, individual tastes and some special factors Samuelson and Nordhaus, 1992. Income is a major
factor determining demand. Agbola 2003 found that an increase in income will increase the demand for meat and fish, grains, dairy products, fruits, vegetables and
other foods with different proportions. A similar thing happened on the demand of grain products, fruits and vegetables, dairy products, meat and alternatives, and
other food in Canada Ricciuto et al., 2006 and also the demand for meat in Malaysia Baharumshah and Muhamed, 1993.
D. Hypothesis
The hypothesis of the study is stated as follows. 1.
Factors which determine consumer preferences included the perceptions of organic farming, organic rice purity, environmental concern, family income and
the location of the consumer. All of these factors have positive influence on consumer preferences.
2. The price of organic rice is influenced by grain heads, grain color, chalky grain,
brown grain, foreign matter, texture, aromas, volume of cooked rice, sweetness, and shelf life.
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