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Tracing The Costs And Benefits Of Improvements In Food Safety: The Case Of Hazard Analysis And Critical Control Point Program For Meat And Poultry

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  • Golan, Elise H.
  • Vogel, Stephen J.
  • Frenzen, Paul D.
  • Ralston, Katherine L.

Abstract

The level and distribution of the costs and benefits of the Hazard Analysis and Critical Control Point (HACCP) regulatory program for meat and poultry change dramatically once economywide effects are included in the analysis. Using a Social Accounting Matrix Model, we find that reduced premature deaths had a strong positive effect on household income, with economywide benefits almost double initial benefits. Contrary to expectations, reduced medical expenses resulted in a decrease in household income, while HACCP costs resulted in an increase. Net economywide benefits were slightly larger than initial net benefits, with poor households receiving a proportionally smaller share of the increased benefits than nonpoor because of their weak ties to the economy. Our SAM analysis provides policymakers useful information about who ultimately benefits from reduced foodborne illnesses and who ultimately pays the costs of food safety regulation. This analysis also sheds light on a number of issues central to cost-benefit analysis involving health, highlighting the danger of equating changes in income with changes in well-being.

Suggested Citation

  • Golan, Elise H. & Vogel, Stephen J. & Frenzen, Paul D. & Ralston, Katherine L., 2000. "Tracing The Costs And Benefits Of Improvements In Food Safety: The Case Of Hazard Analysis And Critical Control Point Program For Meat And Poultry," Agricultural Economic Reports 34023, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uerser:34023
    DOI: 10.22004/ag.econ.34023
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    References listed on IDEAS

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    1. Udith Krishantha Jayasinghe-Mudalige & Spencer Henson, 2006. "Economic Incentives for Firms to Implement Enhanced Food Safety Controls: Case of the Canadian Red Meat and Poultry Processing Sector," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 28(4), pages 494-514.
    2. Lippert, Christian, 2002. "Zur Ökonomik der Kontrollmaßnahmen bei Lebensmitteln und Futtermitteln," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 51(03), pages 1-14.
    3. Houssa, Romain & Verpoorten, Marijke, 2015. "The Unintended Consequence of an Export Ban: Evidence from Benin’s Shrimp Sector," World Development, Elsevier, vol. 67(C), pages 138-150.
    4. Rich, Karl M. & Roland-Holst, David & Otte, Joachim, 2014. "An assessment of the ex-post socio-economic impacts of global rinderpest eradication: Methodological issues and applications to rinderpest control programs in Chad and India," Food Policy, Elsevier, vol. 44(C), pages 248-261.
    5. Spencer Henson, 2003. "The Economics of Food Safety in Developing Countries," Working Papers 03-19, Agricultural and Development Economics Division of the Food and Agriculture Organization of the United Nations (FAO - ESA).
    6. Jayasinghe-Mudalige, Udith K. & Henson, Spencer J., 2004. "Quantifying The Impact Of Economic Incentives On Firms' Food Safety Responsiveness: The Case Of Red Meat And Poultry Processing Sector In Canada," 2004 Annual meeting, August 1-4, Denver, CO 20419, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    7. Ragona, Maddalena & Mazzocchi, Mario, 2008. "Measuring the Impacts of Food Safety Regulations: A Methodological Review," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 43864, European Association of Agricultural Economists.
    8. Romano, Donato & Cavicchi, Alessio & Rocchi, Benedetto & Stefani, Gianluca, 2004. "Costs and Benefits of Compliance for HACCP Regulation in the Italian Meat and Dairy Sector," 84th Seminar, February 8-11, 2004, Zeist, The Netherlands 24983, European Association of Agricultural Economists.
    9. Firda Rahmadani & Hyunsoo Lee, 2020. "Dynamic Model for the Epidemiology of Diarrhea and Simulation Considering Multiple Disease Carriers," IJERPH, MDPI, vol. 17(16), pages 1-14, August.

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