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Food Safety Regulation and Firm Productivity:Evidence from the French Food Industry

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  • Bontemps, Christophe
  • Nauges, Céline
  • Réquillart, Vincent
  • Simioni, Michel

Abstract

The purpose of this article is to assess whether food safety regulations imposed by the European Union in the 2000s may have induced a slow-down in the productivity of firms in the food processing sector. The impact of regulations on costs and productivity has seldom been studied. This article contributes to the literature by measuring productivity change using a panel of French food processing firms for the years 1996 to 2006. To do so, we develop an original iterative testing procedure based on the comparison of the distribution of efficiency scores of a set of firms. Our results confirm that productivity decreased in two major food processing sectors (poultry and cheese) at the time when safety regulation was reinforced.

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Paper provided by Toulouse School of Economics (TSE) in its series TSE Working Papers with number 12-275.

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Date of creation: Jan 2012
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Handle: RePEc:tse:wpaper:25479

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  1. Cuesta, Rafael A. & Knox, C.A. & Zofío, José Luis, 2007. "Environmental Efficiency Measurement with Translog Distance Functions: A Parametric Approach," Working Papers in Economic Theory 2007/02, Universidad Autónoma de Madrid (Spain), Department of Economic Analysis (Economic Theory and Economic History).
  2. Simar, L. & Wilson, P.W., 1998. "Productivity Growth in Industrialized Countries," Papers 9810, Catholique de Louvain - Institut de statistique.
  3. John M. Antle, 2000. "No Such Thing as a Free Safe Lunch: The Cost of Food Safety Regulation in the Meat Industry," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(2), pages 310-322.
  4. Ambec, Stefan & Cohen, Mark & Elgie, Stewart & Lanoie, Paul, 2010. "The Porter Hypothesis at 20: Can Environmental Regulation Enhance Innovation and Competitiveness?," IDEI Working Papers 655, Institut d'Économie Industrielle (IDEI), Toulouse.
  5. C. O’Donnell, 2014. "Econometric estimation of distance functions and associated measures of productivity and efficiency change," Journal of Productivity Analysis, Springer, vol. 41(2), pages 187-200, April.
  6. Christian Fischer & Sebastian Schornberg, 2007. "Assessing the competitiveness situation of EU food and drink manufacturing industries: An index-based approach," Agribusiness, John Wiley & Sons, Ltd., vol. 23(4), pages 473-495.
  7. C.J. O'Donnell, 2008. "An aggregate quantity-price framework for measuring and Decomposing productivity and profitability change," CEPA Working Papers Series WP072008, School of Economics, University of Queensland, Australia.
  8. Goodwin, Harold L., Jr. & Shiptsova, Rimma, 2000. "Welfare Losses From Food Safety Regulation In The Poultry Industry," Staff Papers 15780, University of Arkansas, Department of Agricultural Economics and Agribusiness.
  9. Tulkens, Henry & Vanden Eeckaut, Philippe, 1995. "Non-frontier measures of efficiency, progress and regress for time series data," International Journal of Production Economics, Elsevier, vol. 39(1-2), pages 83-97, April.
  10. Paul Lanoie & Michel Patry & Richard Lajeunesse, 2008. "Environmental regulation and productivity: testing the porter hypothesis," Journal of Productivity Analysis, Springer, vol. 30(2), pages 121-128, October.
  11. O'Donnell, Christopher J., 2009. "Measuring And Decomposing Agricultural Productivity And Profitability Change," 2009 Conference (53rd), February 11-13, 2009, Cairns, Australia 47625, Australian Agricultural and Resource Economics Society.
  12. Tristen Hayfield & Jeffrey S. Racine, . "Nonparametric Econometrics: The np Package," Journal of Statistical Software, American Statistical Association, vol. 27(i05).
  13. Simar, Leopold & Zelenyuk, Valentin, 2004. "On testing equality of distributions of technical efficiency scores," MPRA Paper 28003, University Library of Munich, Germany.
  14. Steven Buccola & Fujii Yoko & Xia Yin, 2000. "Size and Productivity in the U.S. Milling and Baking Industries," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(4), pages 865-880.
  15. Wilson, Paul W, 1993. "Detecting Outliers in Deterministic Nonparametric Frontier Models with Multiple Outputs," Journal of Business & Economic Statistics, American Statistical Association, vol. 11(3), pages 319-23, July.
  16. Bontemps, Christophe & Maigné, Elise & Réquillart, Vincent, 2010. "La productivité de l'agro-alimentaire français de 1996 à 2006," IDEI Working Papers 595, Institut d'Économie Industrielle (IDEI), Toulouse.
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Cited by:
  1. Peroni, Chiara & DiMaria, Charles Henri, 2012. "A new unit labour cost changes decomposition Four pillars of cost competitiveness recovery," MPRA Paper 38670, University Library of Munich, Germany.
  2. Charles-Henri Dimaria & Chiara Peroni, 2012. "Unit labor cost and productivity recovery under non neutral technical change," Working Papers halshs-00826351, HAL.

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