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Consumer Impact of Animal Welfare Regulation in the California Poultry Industry

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  • Allender, William J.
  • Richards, Timothy J.

Abstract

This study examines the consumer welfare impact of animal welfare legislation mandating cage-free egg production in California. We estimate California egg consumers’ willingness to pay (WTP) for cage-free eggs using household-level purchase data and compare the implied premium to higher production costs when calculating the potential change in consumer surplus. Our findings suggest that larger households and/or households with limited means are most likely to be affected. Furthermore, the implied welfare loss for consumers is approximately $106 million. Although consumers value cage-free eggs, higher production costs result in a net welfare loss to consumers. One implication of this finding is that a clear labeling practice may be a more efficient way to motivate animal welfare and non-cage systems.

Suggested Citation

  • Allender, William J. & Richards, Timothy J., 2010. "Consumer Impact of Animal Welfare Regulation in the California Poultry Industry," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 35(3), pages 1-19, December.
    • Handle: RePEc:ags:jlaare:97856
    DOI: 10.22004/ag.econ.97856
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    References listed on IDEAS

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    1. Laura Mørch Andersen, 2011. "Animal Welfare and Eggs – Cheap Talk or Money on the Counter?," Journal of Agricultural Economics, Wiley Blackwell, vol. 62(3), pages 565-584, September.
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    Cited by:

    1. Tomislav Vukina & Danijel Nestic, 2020. "Paying for animal welfare? A hedonic analysis of egg prices," Agribusiness, John Wiley & Sons, Ltd., vol. 36(4), pages 613-630, October.
    2. Malone, Trey & Schaefer, K. Aleks & Lusk, Jayson L., 2021. "Unscrambling U.S. egg supply chains amid COVID-19," Food Policy, Elsevier, vol. 101(C).
    3. Sohae Eve Oh & Tomislav Vukina, 2022. "The price of cage‐free eggs: Social cost of Proposition 12 in California," American Journal of Agricultural Economics, John Wiley & Sons, vol. 104(4), pages 1293-1326, August.
    4. Francisco Alex J. & Bruce Jared M. & Lim Seung-Lark & Bruce Amanda S. & Crespi John M. & Lusk Jayson L. & McFadden Brandon & Aupperle Robin L., 2015. "Are Consumers as Constrained as Hens are Confined? Brain Activations and Behavioral Choices after Informational Influence," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 13(1), pages 113-119, January.
    5. Conner Mullally & Jayson L Lusk, 2018. "The Impact of Farm Animal Housing Restrictions on Egg Prices, Consumer Welfare, and Production in California," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 100(3), pages 649-669.
    6. Heng, Yan & Hanawa Peterson, Hikaru & Li, Xianghong, 2013. "Consumer Attitudes toward Farm-Animal Welfare: The Case of Laying Hens," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 38(3), pages 1-17.
    7. Lai, Yufeng & Yue, Chengyan, 2020. "Consumer Willingness to pay for Organic and Animal Welfare Product Attributes: Do Experimental Results Align with Market Data?," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304328, Agricultural and Applied Economics Association.
    8. Lai, Yufeng & Boaitey, Albert & Minegishi, Kota, 2022. "Behind the veil: Social desirability bias and animal welfare ballot initiatives," Food Policy, Elsevier, vol. 106(C).
    9. Heng, Yan & Peterson, Hikaru Hanawa & Li, Xianghong, 2012. "Consumers’ Preferences for Shell Eggs Regarding Laying Hen Welfare," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124592, Agricultural and Applied Economics Association.
    10. Oh, Sohae & Vukina, Tomislav, 2020. "Quantifying the Welfare Effects of Laying-hen Cage Ban," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304408, Agricultural and Applied Economics Association.
    11. Malone, Trey & Lusk, Jayson L., 2016. "Putting the Chicken Before the Egg Price: An Ex Post Analysis of California's Battery Cage Ban," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 41(3), pages 1-15, September.
    12. Paul, Andrew S. & Lusk, Jayson L. & Norwood, F. Bailey & Tonsor, Glynn T., 2019. "An experiment on the vote-buy gap with application to cage-free eggs," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 79(C), pages 102-109.
    13. Colin A. Carter & K. Aleks Schaefer & Daniel Scheitrum, 2021. "Piecemeal Farm Regulation and the U.S. Commerce Clause," American Journal of Agricultural Economics, John Wiley & Sons, vol. 103(3), pages 1141-1163, May.
    14. Jayson L. Lusk, 2019. "Consumer preferences for cage‐free eggs and impacts of retailer pledges," Agribusiness, John Wiley & Sons, Ltd., vol. 35(2), pages 129-148, April.
    15. Ortega, David L. & Wolf, Christopher A., 2018. "Demand for farm animal welfare and producer implications: Results from a field experiment in Michigan," Food Policy, Elsevier, vol. 74(C), pages 74-81.

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    Livestock Production/Industries;

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