Incentive systems for food quality control with repeated deliveries: Salmonella control in pork production

Robert P. King, Gé B.C. Backus, Monique A. Van Der Gaag

Research output: Contribution to journalArticlepeer-review

20 Scopus citations

Abstract

This paper presents a dynamic principal-agent analysis of incentive systems for Salmonella control. The European Union will require Salmonella testing from 2008. On the basis of the producer's performance history in controlling Salmonella, the incentive systems analysed determine quality premiums to the producer, testing frequencies for hogs delivered, as well as charges to the producer for testing and penalties. Using cost estimates and technical parameters, we evaluate two dynamic incentive systems. We also assess the impact of ownership structure on performance. The more efficient incentive system economises on testing costs by reducing the probability of testing in response to a favourable production history and is preferred under all ownership structures.

Original languageEnglish (US)
Pages (from-to)81-104
Number of pages24
JournalEuropean Review of Agricultural Economics
Volume34
Issue number1
DOIs
StatePublished - Mar 1 2007

Keywords

  • Dynamic programming
  • Food quality
  • Principal-agent

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