Agrifood safety standards, market power and consumer misperceptions
This paper analyzes how the implementation of a food safety standard affects firms strategic behaviour within the context of a food chain. We provide a formal analysis, which considers that the sanitary risk results from a strong heterogeneity of upstream production conditions and the final demand depends on consumers risk estimations (given that consumers may underestimate or, conversely, overestimate the sanitary risk). We show how downstream (processing or retailing) firms may be prompted to play a positive role with respect to food safety, either by selecting only the safest upstream producers or by encouraging the improvement of suppliers production conditions. When the degree of consumers risk misperception is relatively low, then a downstream firm may adopt the latter strategy and increase the marketed quantities as the food safety standard is improved. However, we show that the actual contamination risk is not necessarily decreasing in the level of the food safety standard.
|Date of creation:||2007|
|Date of revision:|
|Contact details of provider:|| Web page: http://www.eaae.org|
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Fox, John A. & Shogren, Jason F. & Hayes, Dermot J. & Kliebenstein, James B., 1995. "Chapter 06: EXPERIMENTAL AUCTIONS TO MEASURE WILLINGNESS TO PAY FOR FOOD SAFETY," Valuing Food Safety and Nutrition (1995), Regional Research Project NE-165 Private Strategies, Public Policies, and Food System Performance, number 25986.
- Fox, John A. & Shogren, J. & Hayes, Dermot J. & Kliebenstein, James, 1995. "Experimental Auctions to Measure Willingness to Pay for Food Safety," Staff General Research Papers 5343, Iowa State University, Department of Economics.
- Marcel Boyer & Donatella Porrini, 2004.
"Modelling the choice between regulation and liability in terms of social welfare,"
Canadian Journal of Economics,
Canadian Economics Association, vol. 37(3), pages 590-612, August.
- Marcel Boyer & Donatella Porrini, 2002. "Modeling the Choice Between Regulation and Liability in Terms of Social Welfare," CIRANO Working Papers 2002s-13, CIRANO.
- Unnevehr, Laurian J. & Jensen, Helen H., 1999.
"Economic Implications of Using HACCP As a Food Safety Regulatory Standard (The),"
Staff General Research Papers
1631, Iowa State University, Department of Economics.
- Laurian J. Unnevehr & Helen H. Jensen, 1999. "Economic Implications of Using HACCP as a Food Safety Regulatory Standard, The," Center for Agricultural and Rural Development (CARD) Publications 99-wp228, Center for Agricultural and Rural Development (CARD) at Iowa State University.
- Fulponi, Linda, 2006. "Private voluntary standards in the food system: The perspective of major food retailers in OECD countries," Food Policy, Elsevier, vol. 31(1), pages 1-13, February.
- Eric Giraud-Héraud & Hakim Hammoudi & Louis-Georges Soler, 2006. "Food Safety, Liability and Collective Norms," Working Papers hal-00243034, HAL.
- Harrington, Winston & Portney, Paul R., 1987. "Valuing the benefits of health and safety regulation," Journal of Urban Economics, Elsevier, vol. 22(1), pages 101-112, July.
- Loader, Rupert & Hobbs, Jill E., 1999. "Strategic responses to food safety legislation," Food Policy, Elsevier, vol. 24(6), pages 685-706, December.
- Antle, John M., 1999. "Benefits and costs of food safety regulation," Food Policy, Elsevier, vol. 24(6), pages 605-623, December.
- Henson, Spencer & Caswell, Julie, 1999. "Food safety regulation: an overview of contemporary issues," Food Policy, Elsevier, vol. 24(6), pages 589-603, December.
- Kolstad, Charles D & Ulen, Thomas S & Johnson, Gary V, 1990. "Ex Post Liability for Harm vs. Ex Ante Safety Regulation: Substitutes or Complements?," American Economic Review, American Economic Association, vol. 80(4), pages 888-901, September.
- Julie A. Caswell & Jaana K. Kleinschmit v. L., 1997. "Using Benefit-Cost Criteria for Settling Federalism Disputes: An Application to Food Safety Regulation," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(1), pages 24-38.
- Henson, Spencer & Heasman, Michael, 1998. "Food safety regulation and the firm: understanding the compliance process1," Food Policy, Elsevier, vol. 23(1), pages 9-23, February.
- Innes, Robert, 2004. "Enforcement costs, optimal sanctions, and the choice between ex-post liability and ex-ante regulation," International Review of Law and Economics, Elsevier, vol. 24(1), pages 29-48, March.
- Schmitz, Patrick W., 2000.
"On the Joint Use of Liability and Safety Regulation,"
12536, University Library of Munich, Germany.
- Schmitz, Patrick W., 2000. "On the joint use of liability and safety regulation," International Review of Law and Economics, Elsevier, vol. 20(3), pages 371-382, September.
- A. Mitchell Polinsky & William P. Rogerson, 1982.
"Products Liability, Consumer Misperceptions, and Market Power,"
NBER Working Papers
0937, National Bureau of Economic Research, Inc.
- A. Mitchell Polinsky & William P. Rogerson, 1983. "Products Liability, Consumer Misperceptions, and Market Power," Bell Journal of Economics, The RAND Corporation, vol. 14(2), pages 581-589, Autumn.
- Bazoche Pascale & Giraud-Héraud Eric & Soler Louis-Georges, 2005. "Premium Private Labels, Supply Contracts, Market Segmentation, and Spot Prices," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 3(1), pages 1-30, February.
- Unnevehr, Laurian J. & Jensen, Helen H., 1999. "The economic implications of using HACCP as a food safety regulatory standard," Food Policy, Elsevier, vol. 24(6), pages 625-635, December.
- Starbird S. Andrew & Amanor-Boadu Vincent, 2007. "Contract Selectivity, Food Safety, and Traceability," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 5(1), pages 1-22, February.
- Hiriart, Yolande & Martimort, David & Pouyet, Jérôme, 2004.
"On the Optimal Use of Ex Ante Regulation and Ex Post Liability,"
IDEI Working Papers
274, Institut d'Économie Industrielle (IDEI), Toulouse.
- Hiriart, Yolande & Martimort, David & Pouyet, Jerome, 2004. "On the optimal use of ex ante regulation and ex post liability," Economics Letters, Elsevier, vol. 84(2), pages 231-235, August.
When requesting a correction, please mention this item's handle: RePEc:ags:eaa105:7849. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If references are entirely missing, you can add them using this form.