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Wiley InterScience | |||||||||||
  American Journal of Agricultural EconomicsVolume 90 Issue 1, Pages 15 - 27 Published Online: 27 Sep 2007 © 2009 Agricultural and Applied Economics Association
Abstract | References | Full Text: HTML, PDF (Size: 118K) | Related Articles | Citation Tracking 
Traceability, Liability, and Incentives for Food Safety and Quality
The authors acknowledge financial support from the Agricultural Marketing Research Center, the Center for Agricultural Business, California State University, Fresno and the Giannini Foundation of Agricultural Economics. Sébastien Pouliot acknowledges the financial support of the Social Sciences and Humanities Research Council of Canada. The authors are thankful to two anonymous referees, the editor Walter N. Thurman, Richard J. Sexton, Antoine Champetier de Ribes, Christopher Gustafson, participants at the American Agricultural Economic Association meeting, July 2006, Long Beach, California, and participants of the AG-IO forum at the University of California, Davis for helpful comments and discussions. Portions of this research were a part of a larger project with Mechel Paggi. All remaining errors are the responsibility of the authors. Copyright 2008 American Agricultural Economics Association KEYWORDS foodborne illness • food safety • liability • traceability ABSTRACTRecent food scares such as the discoveries of Bovine Spongiform Encephalopathy and E. coli-contaminated spinach have heightened interest in food traceability. Here, we show how exogenous increases in food traceability create incentives for farms and marketing firms to supply safer food by increasing liability costs. We model a stylized marketing chain composed of farms, marketers, and consumers. Unsafe food for consumers can be caused by either marketers or farms. We show that food safety declines with the number of farms and marketers and imperfect traceability from consumers to marketers dampens liability incentives to supply safer food by farms. [Received November 2006; | 
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