Information asymmetry and the role of traceability systems

Jill Hobbs

Agribusiness, 2004, vol. 20, issue 4, 397-415

Abstract: The role of food traceability systems in resolving information asymmetry is explored. Three functions of traceability systems are identified: ex post reactive systems that allow the traceback of affected products in the event of a contamination problem so as to minimize social costs, ex post systems that facilitate the allocation of liability, and information systems that provide ex ante quality verification. A taxonomy of traceability systems illustrates the multidimensional nature of the information problems related to food safety and food quality. A model of ex ante quality verification and ex post traceability systems is used to demonstrate the different functions and incentives of a traceability system. Finally, examples of private sector and regulatory traceability initiatives are discussed within the context of the ex post and ex ante models developed in the paper. [EconLit citations: Q130; Q180; L150.] © 2004 Wiley Periodicals, Inc. Agribusiness 20: 397-415, 2004.

Date: 2004
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Persistent link: https://EconPapers.repec.org/RePEc:wly:agribz:v:20:y:2004:i:4:p:397-415

DOI: 10.1002/agr.20020

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