Contingent valuation methods have been a major tool to measure consumer preference for a variety of goods including private and public goods. However, hypothetical bias and lack of payment obligation always plague precision of estimation. This report argues that an experimental method using auction can be used to measure consumer preference. An empirical case using an experimental auction was introduced based on a previous study on the wakame industry in the Sanriku region in Japan. To contribute to recovery from the damage caused by the huge earthquake and tsunami that hit the eastern part of Japan in 2011, an experimental research was conducted from both the consumer and producer sides. The focus of this case study is on the modification of processing standards. An experimental auction was implemented to compare the values of conventional wakame seaweed with that using a new destemming standard, which is more time-saving to produce. An auction experiment compared different destemming standards. Though consumer preferences were diverse, there was no preference between the conventional 1-mm and 4-mm standards. A production experiment showed introduction of the new destemming standard decreased the cost by 26%. The new standard would increase profit by 13.3% without affecting consumer demand.
