The economics and potential protectionism of food safety standards and inspections: An application to the U.S. shrimp market

John C. Beghin, Anne Celia Disdier, Stéphan Marette

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract

We formally investigate the effects of an inspection system influencing safety of foreign and domestic food products in the domestic market. Consumers purchase domestic and imported food and value safety. Potential protectionism à la Fisher and Serra (2000) can arise: inspection frequency imposed on foreign producers set by a domestic social planner would be higher than the corresponding policy set by a global social planner treating all producers as domestic. The domestic social planner tends to impose most if not all of the inspection on foreign producers, which improves food safety for consumers and Umits the production loss for domestic producers. Despite this protectionist component, inspections address a potential consumption externality such as health hazard in the domestic country when unsafe food can enter the country undetected. We then calibrate the analytical framework to the U.S. shrimp market incorporating key stylized facts of this market. Identifying protectionist inspection requires much information on inspection, safety, damages, and costs. We also investigate how to finance the inspection policy from a social planner perspective. Financing instruments differ between the domestic and international welfare-maximizing objectives.

Original languageEnglish (US)
Title of host publicationNontariff Measures and International Trade
PublisherWorld Scientific Publishing Co. Pte Ltd
Pages209-237
Number of pages29
ISBN (Electronic)9789813144415
ISBN (Print)9789813144408
DOIs
StatePublished - Nov 28 2016
Externally publishedYes

Keywords

  • Food safety
  • HACCP
  • Inspection
  • Nontariff measures
  • Protectionism
  • Seafood

ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)
  • Business, Management and Accounting(all)
  • Social Sciences(all)

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