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Sales Loss Determination in Food Contamination Incidents: An Application to Milk Bans in Hawaii

Listed author(s):
  • Smith, Mark E.
  • van Ravenswaay, Eileen O.
  • Thompson, Stanley R.

This article presents a procedure for estimating sales loss following a food contamination incident with application to the case of heptachlor contamination of fresh fluid milk in Oahu, Hawaii in 1982. A major finding is that media coverage following the incident had a significant impact on milk purchases and that negative coverage had a larger effect than positive coverage. This conclusion implies that public statements by producers or government to assure the public of safe food supplies may be ineffective in restoring consumer confidence following the discovery of a food safety problem. American Journal of Agricultural Economics, August, 1988.

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Paper provided by Regional Research Project NE-165 Private Strategies, Public Policies, and Food System Performance in its series Working Papers with number 115803.

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Date of creation: 1987
Handle: RePEc:ags:rpspwp:115803
Contact details of provider: Postal:
Draper Hall, College of Food and Natural Resources, Amherst, MA 01003

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  1. David G. Swartz & Ivar E. Strand, Jr., 1981. "Avoidance Costs Associated with Imperfect Information: The Case of Kepone," Land Economics, University of Wisconsin Press, vol. 57(2), pages 139-150.
  2. Hamilton, James L, 1972. "The Demand for Cigarettes: Advertising, the Health Scare, and the Cigarette Advertising Ban," The Review of Economics and Statistics, MIT Press, vol. 54(4), pages 401-411, November.
  3. Joseph D. Brown, 1969. "Effect of a Health Hazard "Scare" on Consumer Demand," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 51(3), pages 676-678.
  4. James G. MacKinnon, 1983. "Model Specification Tests Against Non-Nested Alternatives," Working Papers 573, Queen's University, Department of Economics.
  5. Robert N. Shulstad & Herbert H. Stoevener, 1978. "The Effects of Mercury Contamination in Pheasants on the Value of Pheasant Hunting in Oregon," Land Economics, University of Wisconsin Press, vol. 54(1), pages 39-49.
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