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Long-Run Effects From Consumer Reaction To The Spread Of Foodborne Pathogens: The Case Of E. Coli Contamination Of Beef At Jack In The Box Restaurants

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  • Zhen, Chen

Abstract

Using news coverage of food safety as an indicator of public attention to food pathogen issues in meat products, we found the 1993 E. coli O157:H7 contamination of hamburgers likely permanently changed consumers' perception of beef safety. A food consumption model with rational habit persistence is developed to examine whether consumers make forward-looking consumption decisions accounting for expectations of future food safety. We document clear evidence of forward-looking consumption behavior, which suggests that government regulations implemented subsequent to the 1993 event to protect consumers from ignorance or cognitive defects may be ineffective.

Suggested Citation

  • Zhen, Chen, 2009. "Long-Run Effects From Consumer Reaction To The Spread Of Foodborne Pathogens: The Case Of E. Coli Contamination Of Beef At Jack In The Box Restaurants," 2009 Conference, August 16-22, 2009, Beijing, China 51341, International Association of Agricultural Economists.
  • Handle: RePEc:ags:iaae09:51341
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    File URL: http://purl.umn.edu/51341
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    References listed on IDEAS

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    1. Wolfram Schlenker & Sofia B. Villas-Boas, 2009. "Consumer and Market Responses to Mad Cow Disease," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(4), pages 1140-1152.
    2. Jushan Bai & Pierre Perron, 1998. "Estimating and Testing Linear Models with Multiple Structural Changes," Econometrica, Econometric Society, vol. 66(1), pages 47-78, January.
    3. Starke, Yolanda & Ralston, Katherine L. & Brent, C. Philip & Riggins, Toija & Lin, Chung-Tung Jordan, 2002. "Consumer Food Safety Behavior: A Case Study In Hamburger Cooking And Ordering," Agricultural Economics Reports 34061, United States Department of Agriculture, Economic Research Service.
    4. Nicholas E. Piggott & Thomas L. Marsh, 2004. "Does Food Safety Information Impact U.S. Meat Demand?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 86(1), pages 154-174.
    5. Hall, Alastair R., 2004. "Generalized Method of Moments," OUP Catalogue, Oxford University Press, number 9780198775201.
    6. Paolo Zagaglia, 2005. "Solving Rational-Expectations Models through the Anderson-Moore Algorithm: An Introduction to the Matlab Implementation," Computational Economics, Springer;Society for Computational Economics, vol. 26(1), pages 91-106, August.
    7. Anderson, Gary & Moore, George, 1985. "A linear algebraic procedure for solving linear perfect foresight models," Economics Letters, Elsevier, vol. 17(3), pages 247-252.
    8. Carter, Colin A. & Smith, Aaron D., 2004. "The Market Effect of a Food Scare: The Case of Genetically Modified StarLink Corn," Working Papers 11997, University of California, Davis, Department of Agricultural and Resource Economics.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    food safety; habit persistence; linear rational expectations model; Demand and Price Analysis; Food Consumption/Nutrition/Food Safety; D12; D18;

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D18 - Microeconomics - - Household Behavior - - - Consumer Protection

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