Agricultural and Applied Economics Association 2010 Annual Meeting
Agricultural & Applied Economics Association 2010 AAEA, CAES, & WAEA Joint Annual Meeting
July 25-27, 2010
We develop a framework in which the cost of producing a quantity food and the cost of food safety differs across firms. We show that large firms may supply the safest food even though small firms have a cost advantage in producing safe food. The model shows that mandatory traceability can decrease the overall safety of food when small firms that supply the safest food exit the industry. Our model applies to food safety but can be applied to a wide range of issues related to regulation and product quality.
D21, L11, L15, Q10
Copyright 2010 by Sébastien Pouliot. All rights reserved. Readers may make verbatim copies of this document for non-commercial purposes by any means, provided that this copyright notice appears on all such copies.
Pouliot, Sebastien, "Welfare Effects of Mandatory Traceability When Firms are Heterogeneous" (2010). Economics Presentations, Posters and Proceedings. 7.