Consumers are prepared to pay more for specially labelled dairy products, according to a study from the USA's University of Wisconsin-Madison.

Researchers Jeremy Foltz and Tirtha Dhar wanted to measure the increase in value on milk products free of artificial growth hormones, pesticide residues or genetic modifications.

They studied milk purchases in 12 key US metropolitan markets and found that consumers will pay up to US$1.50 per gallon more for milk labelled rBST-free and US$3 per gallon more for milk labelled organic. They also found that market competition from the introduction of those labels slightly decreased the price of standard milk.