A Principal-Agent Model for Evaluating the Economic Value of a Beef Traceability System: A Case Study with Injection-site Lesions Control in Fed Cattle
This article investigates the economic value and the optimal expected traceback rate of success for a traceability system with a case study of injection-site lesions in fed cattle in the US. By maintaining the identity of the feedlot owners corresponding to retail beef cuts, a traceability system enables the employment of incentive mechanisms by a meat packer to overcome supply chain information asymmetry. Results of this article show that the first-best action of producers may be induced by meat packers with incentive mechanisms created with a low expected traceback rate of success. This suggests that even inexpensive traceability systems may induce appropriate actions by producers and objectives of inducing compliance by suppliers may be less costly than objectives of recall.
|Date of creation:||14 Oct 2006|
|Contact details of provider:|| Postal: Ludwigstraße 33, D-80539 Munich, Germany|
Web page: https://mpra.ub.uni-muenchen.de
More information through EDIRC
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.:
- S. Andrew Starbird, 2005. "Moral Hazard, Inspection Policy, and Food Safety," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 87(1), pages 15-27.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:467. 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: (Joachim Winter)
If references are entirely missing, you can add them using this form.