IDEAS home Printed from https://ideas.repec.org/a/oup/revage/v28y2006i4p482-493..html
   My bibliography  Save this article

Sales Responses to Recalls for Listeria monocytogenes: Evidence from Branded Ready-to-Eat Meats

Author

Listed:
  • Michael R. Thomsen
  • Rimma Shiptsova
  • Sandra J. Hamm

Abstract

The extent to which brand names insulate firms from the spillover effects of food safety events is a potentially important difference between branded products and the undifferentiated commodity products examined in earlier studies. This paper uses empirical models to measure sales losses experienced by frankfurter brands following a recall for a foodborne pathogen. Results indicate sales of recalled brands declined roughly 22% after a recall. Brand recovery, on average, began two to three months after a recall and sales approached prerecall levels within four to five months. There is no evidence that nonrecalled brands experienced sales losses.

Suggested Citation

  • Michael R. Thomsen & Rimma Shiptsova & Sandra J. Hamm, 2006. "Sales Responses to Recalls for Listeria monocytogenes: Evidence from Branded Ready-to-Eat Meats," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 28(4), pages 482-493.
    • Handle: RePEc:oup:revage:v:28:y:2006:i:4:p:482-493.
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1111/j.1467-9353.2006.00317.x
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Mark E. Smith & Eileen O. van Ravenswaay & Stanley R. Thompson, 1988. "Sales Loss Determination in Food Contamination Incidents: An Application to Milk Bans in Hawaii," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 70(3), pages 513-520.
    2. Richards, Timothy J. & Patterson, Paul M., 1999. "The Economic Value Of Public Relations Expenditures: Food Safety And The Strawberry Case," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 24(2), pages 1-23, December.
    3. Verbeke, Wim & Ward, Ronald W., 2001. "A fresh meat almost ideal demand system incorporating negative TV press and advertising impact," Agricultural Economics, Blackwell, vol. 25(2-3), pages 359-374, September.
    4. Nelson, Philip, 1974. "Advertising as Information," Journal of Political Economy, University of Chicago Press, vol. 82(4), pages 729-754, July/Aug..
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chantal Toledo & Sofia Berto Villas-Boas, 2019. "Safe or Not? Consumer Responses to Recalls with Traceability," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 41(3), pages 519-541, September.
    2. Li, Tongzhe & Bernard, John C. & Johnston, Zachary A. & Messer, Kent D. & Kaiser, Harry M., 2017. "Consumer preferences before and after a food safety scare: An experimental analysis of the 2010 egg recall," Food Policy, Elsevier, vol. 66(C), pages 25-34.
    3. Elena Fagotto, 2014. "Private roles in food safety provision: the law and economics of private food safety," European Journal of Law and Economics, Springer, vol. 37(1), pages 83-109, February.
    4. Zarebanadkoki, Samane & Zheng, Yuqing & Woods, Timothy & Buck, Steven, 2016. "Examining the Effect of Food Recalls on Demand: The Case of Ground Beef in the U.S," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 236112, Agricultural and Applied Economics Association.
    5. Bulut, Harun & Lawrence, John D., 2007. "Meat Slaughter and Processing Plants' Traceability Levels Evidence From Iowa," Staff General Research Papers Archive 12791, Iowa State University, Department of Economics.
    6. Ollinger, Michael & Houser, Matthew, 2020. "Ground beef recalls and subsequent food safety performance," Food Policy, Elsevier, vol. 97(C).
    7. Pozo, Veronica F. & Schroeder, Ted C., 2013. "Effects of Meat Recalls on Firms' Stock Prices," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 151287, Agricultural and Applied Economics Association.
    8. David C. Hall & Tracy D. Johnson-Hall, 2017. "Learning from Conformance Quality Failures That Triggered Product Recalls: The Role of Direct and Indirect Experience," Journal of Supply Chain Management, Institute for Supply Management, vol. 53(4), pages 13-36, October.
    9. Ollinger, Michael & Bovay, John & Guthrie, Joanne & Benicio, Casiano, 2015. "Economic Incentives to Supply Safe Chicken to the National School Lunch Program," Economic Research Report 212888, United States Department of Agriculture, Economic Research Service.
    10. Ollinger, Michael & Muth, Mary K. & Karns, Shawn A. & Choice, Zanethia, 2011. "Food Safety Audits, Plant Characteristics, and Food Safety Technology Use in Meat and Poultry Plants," Economic Information Bulletin 117989, United States Department of Agriculture, Economic Research Service.
    11. Thomsen, Michael R. & Ollinger, Michael & Crandall, Philip G. & O'Bryan, Corliss, 2008. "Mandatory Food Recalls," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6083, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    12. Pozo, Veronica F. & Schroeder, Ted C., 2016. "Evaluating the costs of meat and poultry recalls to food firms using stock returns," Food Policy, Elsevier, vol. 59(C), pages 66-77.
    13. Michael Ollinger & John Bovay, 2020. "Producer Response to Public Disclosure of Food‐Safety Information," American Journal of Agricultural Economics, John Wiley & Sons, vol. 102(1), pages 186-201, January.
    14. Garcia-Fuentes, Pablo & Ferreira, Gustavo & Harrison, R. Wes & Kinsey, Jean D. & Degeneffe, Dennis, 2014. "Consumer Confidence in the Food System, Media Coverage and Stock Prices for the Food Industry," Journal of Food Distribution Research, Food Distribution Research Society, vol. 45(2), pages 1-20, July.
    15. Chebolu-Subramanian, Vijaya & Gaukler, Gary M., 2015. "Product contamination in a multi-stage food supply chain," European Journal of Operational Research, Elsevier, vol. 244(1), pages 164-175.
    16. Neill, Clinton L. & Chen, Susan E., 2021. "Food Safety Events versus Media: Nonlinear Effects of Egg Recalls on U.S. Egg Prices," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 47(1), January.
    17. Ollinger, Michael & Guthrie, Joanne & Bovay, John, 2014. "The Food Safety Performance of Ground Beef Suppliers to the National School Lunch Program," Economic Research Report 262211, United States Department of Agriculture, Economic Research Service.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rieger, Jorg & Kuhlgatz, Christian, 2015. "Analyzing Consumer Demand During a Food Scandal: The Case of Dioxin Contaminated Feed in Germany and the Media," 2015 Conference, August 9-14, 2015, Milan, Italy 212292, International Association of Agricultural Economists.
    2. Thomsen, Michael R. & Shiptsova, Rimma & Hamm, Sandra J., 2004. "Sales Responses To Recalls For Listeria Monocytogenes: Evidence From Branded Ready-To-Eat Meats," 2004 Annual Meeting, February 14-18, 2004, Tulsa, Oklahoma 34602, Southern Agricultural Economics Association.
    3. Rieger, Jörg & Kuhlgatz, Christian & Anders, Sven, 2016. "Food scandals, media attention and habit persistence among desensitised meat consumers," Food Policy, Elsevier, vol. 64(C), pages 82-92.
    4. Zhou, Li & Turvey, Calum & Hu, Wuyang & Ying, Ruiyao, 2015. "Fear and Trust: How Risk Perceptions of Avian Influenza Affect the Demand for Chicken," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 202077, Agricultural and Applied Economics Association.
    5. Martin Browning & Lars Gårn Hansen & Sinne Smed, 2013. "Rational inattention or rational overreaction? Consumer reactions to health news," IFRO Working Paper 2013/14, University of Copenhagen, Department of Food and Resource Economics.
    6. Richards, Timothy J. & Allender, William J. & Fang, Di, 2011. "Media Advertising and Ballot Initiatives: An Experimental Analysis," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114814, European Association of Agricultural Economists.
    7. Timothy J. Richards & William Nganje, 2014. "Welfare Effects of Food Safety Recalls," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 62(1), pages 107-124, March.
    8. Mazzocchi, Mario, 2004. "Food Scares and Demand Recovery Patterns: An Econometric Investigation," 84th Seminar, February 8-11, 2004, Zeist, The Netherlands 24990, European Association of Agricultural Economists.
    9. Ashutosh Tiwari & Timothy J. Richards, 2016. "Social Networks and Restaurant Ratings," Agribusiness, John Wiley & Sons, Ltd., vol. 32(2), pages 153-174, April.
    10. Bakhtavoryan, Rafael & Capps, Oral & Salin, Victoria, 2014. "The Impact of Food Safety Incidents Across Brands: The Case of the Peter Pan Peanut Butter Recall," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 46(4), pages 559-573, November.
    11. Radwan, Amr & Gil, Jose Maria & Ben Kaabia, Monia & Serra, Teresa, 2008. "Modeling The Impact Of Food Safety Information On Meat Demand In Spain," 107th Seminar, January 30-February 1, 2008, Sevilla, Spain 6672, European Association of Agricultural Economists.
    12. Maria De Paola & Vincenzo Scoppa, 2013. "Consumers’ Reactions to Negative Information on Product Quality: Evidence from Scanner Data," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 42(3), pages 235-280, May.
    13. Andersen, Laura M. & Smed, Sinne, 2010. "What Is It Consumers Really Want And Why? The Case Of Fat In Milk," 115th Joint EAAE/AAEA Seminar, September 15-17, 2010, Freising-Weihenstephan, Germany 116455, European Association of Agricultural Economists.
    14. Aye Chan Myae & Ellen Goddard, 2020. "Household behavior with respect to meat consumption in the presence of BSE and CWD," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 68(3), pages 315-341, September.
    15. Zhou, Li & Turvey, Calum G. & Hu, Wuyang & Ying, Ruiyao, 2016. "Fear and trust: How risk perceptions of avian influenza affect Chinese consumers’ demand for chicken," China Economic Review, Elsevier, vol. 40(C), pages 91-104.
    16. Laura Andersen & Sinne Smed, 2013. "What is it consumers really want, and how can their preferences be influenced? The case of fat in milk," Empirical Economics, Springer, vol. 45(1), pages 323-347, August.
    17. Mario Mazzocchi & Davide Delle Monache & Alexandra Lobb, 2006. "A structural time series approach to modelling multiple and resurgent meat scares in Italy," Applied Economics, Taylor & Francis Journals, vol. 38(14), pages 1677-1688.
    18. Bakhtavoryan, Rafael & Capps, Oral, Jr. & Salin, Victoria, 2014. "Dynamics of Consumer Response to Food Contamination: The 2007 Peanut Butter Recall," Journal of Food Distribution Research, Food Distribution Research Society, vol. 45(2), pages 1-16, July.
    19. Fred A. Yamoah & David E. Yawson, 2014. "Assessing Supermarket Food Shopper Reaction to Horsemeat Scandal in the UK," International Review of Management and Marketing, Econjournals, vol. 4(2), pages 98-107.
    20. Beatty, Timothy & Katare, Bhagyashree, 2016. "What Drives Media Reporting of Food Safety Events? Evidence From U.S. Meat Recalls," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 239243, Agricultural and Applied Economics Association.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:revage:v:28:y:2006:i:4:p:482-493.. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press or Christopher F. Baum (email available below). General contact details of provider: https://edirc.repec.org/data/aaeaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.