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Economic Implications of a Major US Infant Formula Recall: Understanding the Industry, Consumer Behavior, and Policy Response

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Listed:
  • Rudi-Polloshka, Jeta
  • Sariman, Sevval Buse
  • Hejazi, Mina
  • Lathrop, Amanda A.

Abstract

The infant formula recall of 2022 led to substantial shortages in the marketplace for a product that has no market substitutes and is often the sole source of nutrition for young infants. In this case study, we explore the food safety recall from an economic perspective, explaining the industry structure, discussing consumer choice, and exploring government response. The case invites students to explore the complexities that lead to a desperate market situation, with out-of-stock rates for infant formula exceeding 90 percent in many regions of the country. The accompanying teaching note provides guidance and suggested answers for discussion and analytical questions.

Suggested Citation

  • Rudi-Polloshka, Jeta & Sariman, Sevval Buse & Hejazi, Mina & Lathrop, Amanda A., 2026. "Economic Implications of a Major US Infant Formula Recall: Understanding the Industry, Consumer Behavior, and Policy Response," Applied Economics Teaching Resources (AETR), Agricultural and Applied Economics Association, vol. 8(1).
    • Handle: RePEc:ags:aaeatr:397852
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    File URL: https://ageconsearch.umn.edu/record/397852/files/AETR_2025_0260%20Final%20Proof%20Rudi%20Polloshka%20et%20al.pdf
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    References listed on IDEAS

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    1. Billore, Soniya & Anisimova, Tatiana, 2021. "Panic buying research: A systematic literature review and future research agenda," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, issue Early Vie.
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