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Consumer Welfare and the Loss Induced by Withheld Information: The Case of BSE in Italy

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  • Mazzocchi, Mario
  • Stefani, Gianluca

Abstract

The paper develops a measure of consumer welfare losses associated with withheld information about BSE linkage with vCJD. food safety. The Cost of Ignorance (COI) is measured by comparing the utility of the informed choice with the utility of the uninformed one, under condition of improved information. Unlike previous work, based on a single equation demand model, the measure is obtained retrieving a cost function from a dynamic Almost Ideal Demand System. The results indicate that Italian consumers bore a significant loss because of the delayed release of information.

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File URL: http://purl.umn.edu/24927
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Bibliographic Info

Paper provided by European Association of Agricultural Economists in its series 2002 International Congress, August 28-31, 2002, Zaragoza, Spain with number 24927.

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Date of creation: 2002
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Handle: RePEc:ags:eaae02:24927

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Related research

Keywords: Food safety; welfare analysis; information; Food Consumption/Nutrition/Food Safety; BSE; D80; D60; D12;

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  1. Jeffrey T. LaFrance & W. Michael Hanemann, 1989. "The Dual Structure of Incomplete Demand Systems," Development Research Unit Working Paper Series archive-21, Monash University, Department of Economics.
  2. T. Kesavan & Zuhair A. Hassan & Helen H. Jensen & Stanley R. Johnson, 1988. "Dynamics and Long-run Structure in U.S. Meat Demand," Food and Agricultural Policy Research Institute (FAPRI) Publications 88-wp38, Food and Agricultural Policy Research Institute (FAPRI) at Iowa State University.
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  9. Jeffrey T. LaFrance, 1993. "Weak Separability in Applied Welfare Analysis," Development Research Unit Working Paper Series archive-26, Monash University, Department of Economics.
  10. Roe, Brian E. & Teisl, Mario F., 1998. "The Economics Of Labeling: An Overview Of Issues For Health And Environmental Disclosure," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 27(2), October.
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  14. Wim Verbeke & Ronald W. Ward & Jacques Viaene, 2000. "Probit analysis of fresh meat consumption in Belgium: Exploring BSE and television communication impact," Agribusiness, John Wiley & Sons, Ltd., vol. 16(2), pages 215-234.
  15. Mario F. Teisl & Nancy E. Bockstael & Alan Levy, 2001. "Measuring the Welfare Effects of Nutrition Information," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(1), pages 133-149.
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Citations

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Cited by:
  1. Stefani, Gianluca & Valli, Carlotta, 2004. "Exploring the Impacts of Risk Communication Policies on Welfare: Theoretical Aspects," 84th Seminar, February 8-11, 2004, Zeist, The Netherlands 24989, European Association of Agricultural Economists.
  2. Colson, Gregory & Rousu, Matthew C. & Huffman, Wallace E., 2008. "Consumers' Willingness to Pay for New Genetically Modified Food Products: Evidence from Experimental Auctions of Intragenic and Transgenic Foods," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6407, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  3. Iimi, Atsushi, 2007. "Infrastructure and trade preferences for the livestock sector : empirical evidence from the beef industry in Africa," Policy Research Working Paper Series 4201, The World Bank.
  4. 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.

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