Doi.org/10.52340/eab.2026.18.02.14

This article investigates the competitive environment of the vegetable market in Georgia using empirical evidence drawn from consumer behavior. Moving beyond the traditional price-centered view of market competition, the study examines how preferences, perceptions, and purchasing patterns shape the actual model of rivalry between local and imported vegetables. The research is based on a survey of 456 respondents and integrates consumer theory with applied econometric analysis to identify the determinants of purchasing decisions and the structure of demand across different income groups.
The conceptual framework builds on Lancaster’s consumer characteristics approach, Samuelson’s revealed preferences perspective, and Simon’s notion of bounded rationality. These perspectives enable the study to interpret consumer choice not merely as price optimization, but as a process shaped by perceived quality, trust, and informational signals. Furthermore, the analysis incorporates the country-of-origin effect from international marketing theory and applies the income–consumption relationship formalized in the Engel curve to assess whether vegetables function as a necessity or as an income-elastic good.
The empirical results demonstrate that, at the declarative level, consumers prioritize quality (92.1%) and taste (89.0%) over price (66.2%). High ratings for local origin (72.8%) and seasonality (74.6%) indicate that consumers associate vegetables with naturalness, freshness, and trust in production practices. Organic characteristics are also highly valued (76.7%), whereas packaging plays a minor role (35.1%), suggesting that perceived intrinsic attributes outweigh visual marketing cues. These findings point to the presence of strong non-price competition and confirm that consumers are sensitive to qualitative differentiation in the vegetable market.
However, when respondents are forced to choose directly between price and quality, a structural paradox emerges. In a situational trade-off, 82.9% of consumers prioritize price, while only 17.1% choose quality. This discrepancy between declared and revealed preferences illustrates the decisive role of budget constraints in the mass consumption segment. While consumers conceptually value quality, their actual purchasing behavior is strongly shaped by affordability. From a theoretical standpoint, this pattern aligns with bounded rationality, where price becomes an informational shortcut under imperfect knowledge of true quality differences.
The analysis of consumer income and expenditure patterns clarifies the paradox between declared and revealed preferences. Market segmentation by spending levels identifies three distinct groups: a budget segment (58.1%) highly sensitive to price; a middle segment (32.2%) with potential for quality-oriented consumption; and a premium segment (9.7%) characterized by demand for organic or specialized products.
The econometric estimation of the Engel curve, specified in double-logarithmic form and estimated via OLS, yields an income elasticity coefficient of β = 0.576 (significant at the 1% level). This confirms that vegetables are a normal but necessary good: expenditure rises with income, but less than proportionally, consistent with Engel’s law. This explains why the mass market remains price-sensitive despite consumers’ stated preference for quality attributes.
Another crucial finding is the country-of-origin effect. A majority of respondents (59.2%) report that they often or always consider the producer country. Origin thus functions as an external signal of quality and trust, especially where intrinsic attributes cannot be fully assessed prior to consumption. Consequently, local and imported vegetables are not perceived as perfect substitutes, reshaping the competitive structure.
From the perspective of market theory, the Georgian vegetable market exhibits features of monopolistic competition or differentiated competition, as described by Chamberlin. Product origin and perceived naturalness act as differentiation tools, while the dominance of budget segments ensures that price competition remains decisive.
Ultimately, the study demonstrates that the Georgian vegetable market operates within a hybrid competitive structure. The results carry important implications for both agricultural policy and producer strategy. Policies aimed at strengthening quality standards, traceability, and certification can reduce information asymmetry and enhance competitive advantages without relying exclusively on price subsidies. For producers, investments in quality signaling and origin-based branding may yield greater returns than purely price-based competition, provided they maintain the principle of “quality at an affordable price.”

Keywords: Vegetable market, Competition, Consumer behavior, Consumer preferences, Local production, Georgia.
JEL Codes: D12, Q13, L11, C21

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