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11/10/2008
3:41:00 PM Foodborne Illness—Information Gaps Erode The Supply Of Safety Source of Article: http://www.cattlenetwork.com/Content.asp?ContentID=267581 In 1999, the U.S. Centers for Disease Control and
Prevention estimated that annually, one in three Americans becomes ill from a
foodborne disease, one in 700 is hospitalized, and
one in 60,000 dies. Many foodborne illnesses are
preventable. Some reduction in food contamination can be accomplished with
low-tech basic sanitation—hand washing. Cooking deactivates many pathogens.
High-tech methods like irradiation can reduce contamination in raw and
unprepared foods. And pathogen monitoring and testing can confirm whether
procedures have been successful. So why do food
recalls and safety concerns continue to make headlines? There are two possible explanations for the persistence
of food-related illnesses. One explanation is that consumers are unwilling to
pay higher food prices in return for increased safety. Suppliers have to be
compensated for the added cost of labor and capital equipment that would
increase safety. If the increase in cost would be passed on to consumers and
consumers are unwilling to pay the additional cost, suppliers will stop
investing in food safety. Another possibility is that there is an information gap
that is causing the market for food safety to fail. Information problems
might choke off any financial incentive to offer consumers safer food.
Microbial contamination that causes foodborne
illness is difficult for consumers to detect. Contaminated food might look, smell,
and taste no different from uncontaminated food. The information gap means buyers are likely to be wary
of sellers’ claims. If food suppliers cannot convince consumers that they
have gone to the trouble of producing very safe food, their compensation will
not cover expenses and there will not be much safety
offered to consumers. Food suppliers have come up with ways to overcome
information gaps. Having a well-known brand such as McDonald’s, Burger King,
and Wendy’s creates an incentive to ensure that the food supplied to
consumers is safe. A brand with a good reputation is a marketing advantage
and represents an asset its owner has built through financial commitment. A
single foodborne illness linked to the firm could
damage the brand and reduce the value of the investment in brand building. While food suppliers do not make explicit safety claims
on retail food labels, safety claims do influence prices further back in the
food supply chain. As agricultural commodities are transformed into foods,
third-party certifiers are providing validation of quality attributes
(including safety practices used in manufacturing plants), reassuring input
buyers that a product’s attributes are as advertised. In the private sector,
firms like SGS and AIB International, as well as many more, offer services to
validate safety procedures and bolster market differentiation with respect to
food safety. When food providers produce foods that are treated as
undifferentiated commodities, those producers may not have a name brand or
the incentive to guard it. Policymakers may thus decide to intervene in the
market to enforce an acceptable level of food safety for all consumers.
USDA’s Food Safety and Inspection Service is
responsible for the safety of meat, poultry, and egg products. As well as
routine inspections of processing plants, it has promulgated rules requiring
all meat and poultry establishments to develop and implement written
sanitation standard operating procedures and to test for the harmful
pathogens E. coli and Listeria. The U.S. Food and Drug Administration oversees food safety for all other foods. The large question for policy is the extent to which
the private sector has overcome information gaps. If branding and third-party
certification lead to food safety levels that are above minimum government
standards, government intervention cannot be cost effective. But branding and
third-party certification are not universal, so consumers’ demands for safety
may go unmet without government oversight. Source: Amber Waves |
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