FOOD SAFETY IN THE MEAT INDUSTRY: A REGULATORY QUAGMIRE

Food Consumption/Nutrition/Food Safety, Livestock Production/Industries,

FIRMS, INCENTIVES, AND THE SUPPLY OF FOOD SAFETY: A FORMAL MODEL OF GOVERNMENT ENFORCEMENT

Recent instances of significant food safety breeches in both meat and biotechnology challenge traditional safety efforts. A formal model utilizing agency theory is used to explore the power relationships between the regulator and the firm. Fundamental issues effecting firms' supply of safety are demonstrated and alternative corrective mechanisms are discussed.Food Consumption/Nutrition/Food Safety,

Legal systems, institutional environment, and food safety

In the aftermath of the recent food scares, the United States and the United Kingdom face major challenges to maintain a safe food system. Regulators on opposite sides of the Atlantic are facing rapid product and process innovations, changes in consumption behaviors, expansion of international trade, and discovery of new food hazards. The U.K. and the U.S. demonstrate different approaches to manage safety risks. This article will focus on two issues: the reasons behind the differences in the American and English policy approaches to food safety, and how these differences impact U.S. safety outcomes. A comparative legal framework is provided to understand how food safety is elicited in the economy and the incentive implications of the different institutional settings. These two different lenses, because they differ so, teach us about the fundamental sources of safety. The U.K.'s prevalent doctrine is parliamentary sovereignty and leads to a regulatory framework, while the U.S. is based on constitutional supremacy and relies on a legal framework. The source of safety under a regulatory framework is the government bureaucracy, while the U.S. legal framework provides an important point of departure-the constitutional standing of the firm and the consumer. We argue that while the U.K. system is structured to work through a regulatory framework to enhance the supply of safety in the economy, the U.S. system is much less directed. The legal system, the subject of this article, plays an important role not only in discouraging breach but also in acting as a check on the discretionary authority of the regulator. In the end, the U.S. and the U.K. may have equally safe food systems, but what differs is the fundamental source of the safety supply. The practical implication is that safety in the food system emerges from several sources, not just through regulation. Therefore, direct importation of U.K.-style regulatory approaches may not be effective within a U.S. constitutional setting. Copyright 2007 International Association of Agricultural Economists.

FIRMS, INCENTIVES, AND THE SUPPLY OF FOOD SAFETY: A FORMAL MODEL OF GOVERNMENT ENFORCEMENT

Recent instances of significant food safety breeches in both meat and biotechnology challenge traditional safety efforts. A formal model utilizing agency theory is used to explore the power relationships between the regulator and the firm. Fundamental issues effecting firms' supply of safety are demonstrated and alternative corrective mechanisms are discussed