Welfare Effects of Mandatory Traceability When Firms are Heterogeneous
Welfare Effects of Mandatory Traceability When Firms are Heterogeneous
Date
2010-01-01
Authors
Pouliot, Sebastien
Pouliot, Sebastien
Pouliot, Sebastien
Major Professor
Advisor
Committee Member
Journal Title
Journal ISSN
Volume Title
Publisher
Altmetrics
Authors
Pouliot, Sebastien
Person
Research Projects
Organizational Units
Economics
Organizational Unit
Journal Issue
Series
Department
Economics
Abstract
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.
Comments
This is a Selected Paper prepared for presentation at the Agricultural & Applied Economics Association 2010 AAEA, CAES, & WAEA Joint Annual Meeting, Denver, Colorado, July 25-27, 2010.