Farm Animal Welfare and Quality Verification

Existing empirical evidence suggests that farm animal welfare may not be a top-of-mind issue for many consumers in North America. Nevertheless, there is pressure from animal welfare groups on food retailers and processors to implement more stringent requirements for their suppliers. Is the demand for more stringent animal welfare protocols primarily determined by a subset of consumers with very strong preferences or by an underlying change in consumer and societal preferences? Who do consumers trust for credible quality assurances with respect to farm animal welfare attributes? This paper provides a basis for further analysis of these issues. The roles of different stakeholders in delivering farm animal welfare quality assurances to consumers are first discussed. Then a social welfare analysis of the Canadian market for animal friendly pork is presented under different scenarios with respect to the strength of consumer preferences and the existence of voluntary standards versus mandatory standards. The analysis suggests that a situation of voluntary labelling that is reasonably credible is desirable as it maximizes the welfare that accrues to all players on the market. Furthermore, this scenario allows heterogeneous consumers to choose between different combinations of price and quality according to their preferences. The paper concludes with suggestions for further research.