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Certification Mechanisms for Credence Attributes of Foods: Does It Matter Who Provides Diagnosis?

Author

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  • Ian M. Sheldon

    (Department of Agricultural, Environmental, and Development Economics, Ohio State University, Columbus, Ohio 43210)

Abstract

Credence goods markets are subject to failure because consumers are unable to punish fraudulent experts who diagnose and supply treatment, and they lack the technical expertise with which to verify the quality of treatment actually offered. The focus of research in agricultural economics has been almost entirely on how labeling and certification of food products that contain credence attributes resolve the lemons problem. This ignores the crucial role that firms, nongovernmental organizations, or government regulatory agencies, acting either independently or jointly as experts, play in the process of diagnosis and treatment in credence goods markets. This is important if experts fail to act in good faith through their diagnosis and treatment.

Suggested Citation

  • Ian M. Sheldon, 2017. "Certification Mechanisms for Credence Attributes of Foods: Does It Matter Who Provides Diagnosis?," Annual Review of Resource Economics, Annual Reviews, vol. 9(1), pages 33-51, October.
    • Handle: RePEc:anr:reseco:v:9:y:2017:p:33-51
    DOI: 10.1146/annurev-resource-100516-053630
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    Citations

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    Cited by:

    1. Tina L. Saitone & Richard J. Sexton, 2017. "Agri-food supply chain: evolution and performance with conflicting consumer and societal demands," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 44(4), pages 634-657.
    2. Rustagi, Devesh & Kroell, Markus, 2022. "Measuring honesty and explaining adulteration in naturally occurring markets," Journal of Development Economics, Elsevier, vol. 156(C).
    3. Sheldon, Ian M., 2022. "“Enforcement of Private Food Standards: A Role for Self-Reporting of Non-Compliance?”," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322404, Agricultural and Applied Economics Association.
    4. Daniel Rehsmann & Béatrice Roussillon & Paul Schweinzer, 2023. "Contesting Fake News," CESifo Working Paper Series 10632, CESifo.
    5. Del Giudice, Teresa & Cavallo, Carla & Vecchio, Riccardo, 2018. "Credence Attributes, Consumers Trust and Sensory Expectations in Modern Food Market: Is there a Need to Redefine their Role?," International Journal on Food System Dynamics, International Center for Management, Communication, and Research, vol. 9(4), August.
    6. Merel, Pierre & Qin, Zhiran & Sexton, Richard J., 2023. "Policy-Induced Expansion of Organic Farmland: Implications for Food Prices and Welfare," 2023 Annual Meeting, July 23-25, Washington D.C. 335587, Agricultural and Applied Economics Association.
    7. Kari E. R. Heerman & Ian M. Sheldon, 2022. "Sustainable agricultural production, income, and eco‐labeling: What can be learned from a modern Ricardian approach?," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 44(4), pages 1614-1636, December.
    8. Walid Mukahhal & Gumataw Kifle Abebe & Rachel A. Bahn, 2022. "Opportunities and Challenges for Lebanese Horticultural Producers Linked to Corporate Buyers," Agriculture, MDPI, vol. 12(5), pages 1-16, April.
    9. Zilberman, David & Kaplan, Scott & Gordon, Ben, 2018. "The political economy of labeling," Food Policy, Elsevier, vol. 78(C), pages 6-13.

    More about this item

    Keywords

    credence goods; diagnosis and treatment; labeling and certification;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • L5 - Industrial Organization - - Regulation and Industrial Policy
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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