What counts more – fairness to dairy cows or fairness to farmers? The preferences of conventional milk buyers for ethical attributes of milk

Stable organic milk producer prices over the course of the 2015/2016 conventional milk price crisis in the EU suggest that product differentiation according to the preferences of buyers for ethical milk attributes could be a good marketing strategy for conventional milk. Through an online choice experiment conducted in Germany we analyse the preferences of conventional milk buyers for ethical attributes of milk, among others for biodiversity protection and regional production. We especially concentrate on the trade-offs between animal welfare (indicated by the housing system for dairy cows and pasture access) and fairness to farmers (to all farms or to small, below-average-income farms). Our results show highest preferences for the most animal-friendly housing system – free-stall with summer pasture. Overall, respondents have positive willingness to pay for support of small, below-average-income farms in combination with tethering, which suggests that animal welfare concerns are to some extent counterbalanced by fairness to poor farmers.