The implementation mechanisms of voluntary food safety systems

Abstract

International audienceThe recent food scares have been the motivation for voluntary programmes on food safety being promoted by public authorities and voluntarily implemented by food operators. In this article, we take into account the nature of the contamination risk to investigate the complementarities between private and public mechanisms for those voluntary systems to be implemented by a firm. We show two main results. First, when the firm directly markets its products to consumers a strong mandatory threat is a sufficient condition to implement voluntary systems whatever the risk of contamination. In contrast, when the mandatory threat is weak voluntary systems should be more implemented in industries where the risk of food contamination is low (pesticide residue) than in industries where the risk of contamination is high (pathogenic contamination). Second, when the risk of food contamination is low and the firm is embedded in a supply chain where the retailer can impose its own safety system, a well-designed penalty contract will induce a voluntary implementation whatever the mandatory thre

Evolutionary Games in the Agricultural Product Quality and Safety Information System: A Multiagent Simulation Approach

“…However, Broughton and Walker [15] considered agricultural products as public goods exhibiting externality with asymmetric information. Fares and Rouviere [16] argued that the complementation of public and private regulation would reduce food safety risk and the voluntary system would help solve APQS problems. But these researches did not design a complete incentive mechanism among each market agent nor build up an effective regulation or a coordination mechanism from the perspective of multiagent modeling.…”

Food Safety, Market Organization, Trade and Development

“…This system is supposed to be subjected to third-party monitoring. The firm that has Fares and Rouvière (2010) enrich the analysis by distinguishing between "high" risk situation (a contamination episode can have strong and immediate consequences for consumers), and "low" risk situation (more silent risks). In this model, if there is no threat of public intervention, the incentive for the firm still depends on the "carrot and stick" mechanism, but firms are more likely to implement the measure voluntarily in a low risk situation than in a high risk situation (unless the legal rule is sufficiently efficient).…”

Uncertainty of food contamination origin and liability rules: Implications for bargaining power

“…Strengthening public regulations or private food safety standards is not always synonymous with risk reduction and may create some economic distortions. In those two papers, the risk of contaminated product is assumed to come from the upstream agents and to be endogenous (for other approaches, see Fares & Rouviere, ; Hobbs, ; Segerson, ). Starbird and Amanor‐Boadu () point out that the suppliers’ incentives to invest in food safety may depend on various characteristics of the economic environment such as: (a) the frequency and accuracy of inspection; and (b) the various costs associated with failing to provide safe products (i.e., the magnitude of the costs and their allocation within the supply chain).…”