IDEAS home Printed from https://ideas.repec.org/a/bla/jageco/v55y2004i1p41-58.html
   My bibliography  Save this article

Consumer Welfare and the Loss Induced by Withholding Information: The Case of BSE in Italy

Author

Listed:
  • Mario Mazzocchi
  • Gianluca Stefani
  • Spencer J. Henson

Abstract

The paper develops a measure of consumer welfare losses associated with withholding information about a possible link between BSE and vCJD. The Cost of Ignorance (COI) is measured by comparing the utility of the informed choice with the utility of the uninformed choice, under conditions of improved information. Unlike previous work that is largely based on a single equation demand model, the measure is obtained retrieving a cost function from a dynamic Almost Ideal Demand System. The estimated perceived loss for Italian consumers due to delayed information ranges from 12 percent to 54 percent of total meat expenditure, depending on the month assumed to embody correct beliefs about the safety level of beef.

Suggested Citation

  • Mario Mazzocchi & Gianluca Stefani & Spencer J. Henson, 2004. "Consumer Welfare and the Loss Induced by Withholding Information: The Case of BSE in Italy," Journal of Agricultural Economics, Wiley Blackwell, vol. 55(1), pages 41-58, March.
  • Handle: RePEc:bla:jageco:v:55:y:2004:i:1:p:41-58
    DOI: 10.1111/j.1477-9552.2004.tb00078.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1477-9552.2004.tb00078.x
    Download Restriction: no

    File URL: https://libkey.io/10.1111/j.1477-9552.2004.tb00078.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Rousu, Matthew & Huffman, Wallace & Shogren, Jason F. & Tegene, Abebayehu, 2002. "The Value of Verifiable Information in a Controversial Market: Evidence from Lab Auctions of Genetically Modified Food," Staff General Research Papers Archive 10009, Iowa State University, Department of Economics.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Colson, Gregory & Huffman, Wallace E. & Rousu, Matthew C., 2011. "Improving the Nutrient Content of Food through Genetic Modification: Evidence from Experimental Auctions on Consumer Acceptance," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 36(2), pages 1-22, August.
    2. Del Giudice, Teresa & Cavallo, Carla & Vecchio, Riccardo, 2018. "Credence Attributes, Consumers Trust and Sensory Expectations in Modern Food Market: Is there a Need to Redefine their Role?," International Journal on Food System Dynamics, International Center for Management, Communication, and Research, vol. 9(4), August.
    3. Hyun No Kim & Ik-Chang Choi, 2018. "The Economic Impact of Government Policy on Market Prices of Low-Fat Pork in South Korea: A Quasi-Experimental Hedonic Price Approach," Sustainability, MDPI, vol. 10(3), pages 1-16, March.
    4. Colson, Gregory, 2009. "Improving nutrient content through genetic modification: Evidence from experimental auctions on consumer acceptance and willingness to pay for intragenic foods," ISU General Staff Papers 200901010800001872, Iowa State University, Department of Economics.
    5. Irz, Xavier & Mazzocchi, Mario & Réquillart, Vincent & Soler, Louis-Georges, 2015. "Research in Food Economics: past trends and new challenges," Revue d'Etudes en Agriculture et Environnement, Editions NecPlus, vol. 96(01), pages 187-237, March.
    6. Heikkila, Jaakko & Pouta, Eija & Forsman-Hugg, Sari & Makela, Johanna, 2011. "Consumer risk perceptions of zoonotic, chemical and gm risks: the case of poultry purchase intentions in Finland," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114551, European Association of Agricultural Economists.
    7. Shepherd, Jonathan D. & Saghaian, Sayed H., 2008. "Consumer Response to Food Safety Events: An Interaction Between Risk Perception and Trust of Information in the Chicken and Beef Markets," 2008 Annual Meeting, February 2-6, 2008, Dallas, Texas 6822, Southern Agricultural Economics Association.
    8. Lusk, Jayson L., 2016. "From Farm Income to Food Consumption: Valuing USDA Data Products," C-FARE Reports 266593, Council on Food, Agricultural, and Resource Economics (C-FARE).
    9. Luigi Cembalo & Daniela Caso & Valentina Carfora & Francesco Caracciolo & Alessia Lombardi & Gianni Cicia, 2019. "The “Land of Fires” Toxic Waste Scandal and Its Effect on Consumer Food Choices," IJERPH, MDPI, vol. 16(1), pages 1-14, January.
    10. Rosa Ferrer & Helena Perrone, 2017. "Consumers’ Costly Responses to Product-Harm Crises," Working Papers 975, Barcelona School of Economics.
    11. Radwan, Amr & Gil, Jose Maria & Ben Kaabia, Monia & Serra, Teresa, 2008. "Modeling The Impact Of Food Safety Information On Meat Demand In Spain," 107th Seminar, January 30-February 1, 2008, Sevilla, Spain 6672, European Association of Agricultural Economists.
    12. Jaakko Heikkilä & Eija Pouta & Sari Forsman-Hugg & Johanna Mäkelä, 2013. "Heterogeneous Risk Perceptions: The Case of Poultry Meat Purchase Intentions in Finland," IJERPH, MDPI, vol. 10(10), pages 1-19, October.
    13. Heikkila, Jaakko & Pouta, Eija & Forsman-Hugg, Sari & Makela, Johanna, 2010. "Consumer Intentions Of Buying Poultry Meat Under Perceived Biological, Chemical Or Technological Risk In Finland," 115th Joint EAAE/AAEA Seminar, September 15-17, 2010, Freising-Weihenstephan, Germany 116403, European Association of Agricultural Economists.
    14. Dedah, Cheikhna O. & Keithly, Walter R., Jr. & Diop, Hamady & Kazmierczak, Richard F., Jr., 2007. "An Inverse Almost Ideal Demand System for Oysters in the United States: An Empirical Investigation of the Impacts of Mandatory Labels," 2007 Annual Meeting, February 4-7, 2007, Mobile, Alabama 34957, Southern Agricultural Economics Association.
    15. Resende Filho, Moises de Andrade & Buhr, Brian L., 2008. "Sobre O Valor Econômico Do Sistema De Identificação Animal Dos Eua (Nais): Notícias A Respeito Do Mau Da Vaca Louca Afetam O Consumo De Carnes?," 46th Congress, July 20-23, 2008, Rio Branco, Acre, Brazil 112719, Sociedade Brasileira de Economia, Administracao e Sociologia Rural (SOBER).
    16. Iimi, Atsushi, 2007. "Infrastructure and trade preferences for the livestock sector : empirical evidence from the beef industry in Africa," Policy Research Working Paper Series 4201, The World Bank.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. D Rigby & M Burton, 2003. "Capturing Preference Heterogeneity in Stated Choice Models: A Random Parameter Logit Model of the Demand for GM Food," Economics Discussion Paper Series 0319, Economics, The University of Manchester.
    2. Wallace E. Huffman & Matthew Rousu & Jason F. Shogren & Abebayehu Tegene, 2004. "Who Do Consumers Trust for Information: The Case of Genetically Modified Foods?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 86(5), pages 1222-1229.
    3. Mario F. Teisl & Julie A. Caswell, 2003. "Information Policy and Genetically Modified Food: Weighting the Benefits and Costs," QA - Rivista dell'Associazione Rossi-Doria, Associazione Rossi Doria, issue 4, March.
    4. Huffman, Wallace & Rousu, M. & Shogren, Jason F. & Tegene, Abebayehu, 1009. "Are U.S. Consumers Tolerant of GM Foods?," Staff General Research Papers Archive 12336, Iowa State University, Department of Economics.
    5. Xue, Hong & Mainville, Denise Y. & You, Wen & Nayga, Rodolfo M., Jr., 2009. "Nutrition Knowledge, Sensory Characteristics and Consumers’ Willingness to Pay for Pasture-Fed Beef," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49277, Agricultural and Applied Economics Association.
    6. Vijesh V. Krishna & Matin Qaim, 2008. "Consumer Attitudes toward GM Food and Pesticide Residues in India," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 30(2), pages 233-251.
    7. Harrison, R. Wes & Han, Jae-Hwan, 2005. "The Effects of Urban Consumer Perceptions on Attitudes for Labeling of Genetically Modified Foods," Journal of Food Distribution Research, Food Distribution Research Society, vol. 36(2), pages 1-10, July.
    8. Maurizio Canavari & Rodolfo Nayga, 2009. "On consumers' willingness to purchase nutritionally enhanced genetically modified food," Applied Economics, Taylor & Francis Journals, vol. 41(1), pages 125-137.
    9. Hu, Wuyang & Woods, Timothy & Bastin, Sandra & Cox, Linda & You, Wen, 2011. "Assessing Consumer Willingness to Pay for Value-Added Blueberry Products Using a Payment Card Survey," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 43(2), pages 243-258, May.
    10. Jay Corrigan & Matthew Rousu, 2008. "Estimating the value consumers derive from product labeling," Framed Field Experiments 00192, The Field Experiments Website.
    11. Colson, Gregory & Huffman, Wallace E. & Rousu, Matthew C., 2011. "Improving the Nutrient Content of Food through Genetic Modification: Evidence from Experimental Auctions on Consumer Acceptance," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 36(2), pages 1-22, August.
    12. Stefani, Gianluca & Valli, Carlotta, 2004. "Exploring the Impacts of Risk Communication Policies on Welfare: Theoretical Aspects," 84th Seminar, February 8-11, 2004, Zeist, The Netherlands 24989, European Association of Agricultural Economists.
    13. Huffman Wallace E. & Rousu Matthew & Shogren Jason F & Tegene Abebayehu, 2004. "Consumer's Resistance to Genetically Modified Foods: The Role of Information in an Uncertain Environment," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 2(2), pages 1-15, May.
    14. Huffman, Wallace E. & Rousu, Matthew & Shogren, Jason F. & Tegene, Abebayehu, 2007. "The effects of prior beliefs and learning on consumers' acceptance of genetically modified foods," Journal of Economic Behavior & Organization, Elsevier, vol. 63(1), pages 193-206, May.
    15. Huffman, Wallace E. & Rousu, Matthew C. & Shogren, Jason F. & Tegene, Abebayehu, 2002. "Should The United States Initiate A Mandatory Labeling Policy For Genetically Modified Foods?," 2002 Annual meeting, July 28-31, Long Beach, CA 19857, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    16. Xie, Jing & Hyeyoung, Kim & House, Lisa, 2014. "Valuing Information on GM Foods in the presence of Country-of-Origin Labels," International Journal on Food System Dynamics, International Center for Management, Communication, and Research, vol. 4(3), pages 1-14, February.
    17. Brandon R. McFadden & Brittany N. Anderton & Kelly A. Davidson & John C. Bernard, 2021. "The effect of scientific information and narrative on preferences for possible gene‐edited solutions for citrus greening," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 43(4), pages 1595-1620, December.
    18. repec:ken:wpaper:0802 is not listed on IDEAS
    19. Huffman, Wallace & Rousu, Matthew & Shogren, Jason F. & Tegene, Abebayehu, 2002. "Should the United States Regulate Mandatory Labeling for Genetically Modified Foods?," Staff General Research Papers Archive 10047, Iowa State University, Department of Economics.
    20. Marks, Leonie A. & Kalaitzandonakes, Nicholas G. & Vickner, Steven S., 2003. "Evaluating Consumer Response to GM Foods: Some Methodological Considerations," CAFRI: Current Agriculture, Food and Resource Issues, Canadian Agricultural Economics Society, issue 4, pages 1-15, November.
    21. Ganiere, Pierre & Chern, Wen S. & Hahn, David E. & Chiang, Fu-Sung, 2004. "Consumer Attitudes towards Genetically Modified Foods in Emerging Markets: The Impact of Labeling in Taiwan," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 7(3), pages 1-20.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jageco:v:55:y:2004:i:1:p:41-58. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0021-857X .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.