Economics and animals

Jim Leitzel and Sabina Shaikh

Chapter 21 in Research Handbook on Animal Law and Animal Rights, 2025, pp 409-426 from Edward Elgar Publishing

Abstract: Economic efficiency depends on satisfying the preferences of the relevant economic agents. Traditionally, the dividing line between relevant and irrelevant agents has been species: humans are in, and nonhuman animals are out. But that standard demarcation is rarely justified, and the alternative of moving some or all nonhuman animals to the other side of the line, even partially, could have major impacts on judging the comparative efficiency of laws. Economic theory holds that rational choices made within the framework of undistorted, competitive markets result in efficient outcomes. The “market” for animal welfare, however, is subject to many distortions – taxes and subsidies, externalities, imperfect information, missing price signals, and the “publicness” of goods – all of which threaten efficiency. Further, the recent behavioural revolution in the discipline of Economics highlights how the connection between markets and efficiency can be challenged not just by departures from competitive conditions, but also by less-than-optimal behaviour by economic agents. The arenas of animal products and animal welfare are contexts in which behavioural threats to efficiency are likely to be severe. In this chapter, which focuses primarily on farm animals, we explore the traditional economic approach to animals, and consider the implications of allowing animals to be economic agents with preferences. Customary ideas of what constitutes efficiency would have to be overhauled if animal preferences were granted standing in economic analyses.

Keywords: Animals; Animal welfare; Meat taxes; Cost-benefit analysis; Behavioural economics; Law and economics (search for similar items in EconPapers)
Date: 2025
ISBN: 9781035324873
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