Mandatory Food Recalls

Michael R. Thomsen, Michael Ollinger, Philip G. Crandall and Corliss O'Bryan

No 6083, 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: Food recalls are important for two reasons. One is that they mitigate harm when product failures occur. Another is that they augment incentives to invest in safety. When recalls are justified for their mitigation value, it makes sense that regulatory bodies be granted more control of the recall process in order to improve the manner in which recalls are conducted. Such is the stated intent of most proposals for changing the food recall system. However, we show that recalls can be justified by their incentive effect alone. In fact, recalls can be beneficial even when the social value of the harm they mitigate is so small as to be less than the costs of carrying them out. In these cases, it is important that proposals designed to improve the recall process avoid unintended side effects. First, proposals should avoid redirecting regulatory resources towards recall oversight and away from other, more pressing, food safety priorities. Second, it is important to avoid creating an environment in which agencies face a greater need to justify their recall requests. When the mitigation value of recalls is small, this may inadvertently prevent the initiation of recalls that could otherwise play a positive role in aligning incentives for safety.

Keywords: Food; Consumption/Nutrition/Food; Safety (search for similar items in EconPapers)
Pages: 27
Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/6083/files/469682.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea08:6083

DOI: 10.22004/ag.econ.6083

Access Statistics for this paper

More papers in 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().