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The Impact of HACCP on Costs and Product Exit

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  • Hooker, Neal H.
  • Nayga, Rodolfo M.
  • Siebert, John W.

Abstract

Detailed information on firm level food safety costs is reported. Survey data for small and very small meat processors are modeled. Economies of scale in implementing Hazard Analysis Critical Control Point (HACCP) systems are investigated. Results indicate that even after controlling for scale, very small plants incur higher compliance costs. Diseconomies of scope are assessed using the probability and number of products discontinued due to HACCP. Such “partial exit” is positively related to the current range of items produced and the need for facility modification. However, no evidence is found for higher levels of partial exit in very small plants.

Suggested Citation

  • Hooker, Neal H. & Nayga, Rodolfo M. & Siebert, John W., 2002. "The Impact of HACCP on Costs and Product Exit," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 34(1), pages 165-174, April.
    • Handle: RePEc:cup:jagaec:v:34:y:2002:i:01:p:165-174_00
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    References listed on IDEAS

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    1. James M. MacDonald & Stephen Crutchfield, 1996. "Modeling the Costs of Food Safety Regulation," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(5), pages 1285-1290.
    2. Donald W. Anderson & Brian C. Murray & Jackqueline L. Teague & Richard C. Lindrooth, 1998. "Exit from the Meatpacking Industry: A Microdata Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(1), pages 96-106.
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    Cited by:

    1. Ratapol Teratanavat & Victoria Salin & Neal H. Hooker, 2005. "Recall event timing: Measures of managerial performance in U.S. meat and poultry plants," Agribusiness, John Wiley & Sons, Ltd., vol. 21(3), pages 351-373.
    2. Michael Ollinger & Danna Moore, 2009. "The Direct and Indirect Costs of Food-Safety Regulation," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 31(2), pages 247-265, June.
    3. Rajapakse, S. & Jayasinghe-Mudaligeu, U.K, 2005. "Fate of the Product Mix of a Firm with a Mandate to Adopt a Food Quality Metasystem: The Case of Adoption of the SLS in the Fruit Processing Sector in Sri Lanka," Sri Lankan Journal of Agricultural Economics, Sri Lanka Agricultural Economics Association (SAEA), vol. 7, pages 1-19.
    4. Ollinger, Michael, 2008. "Structural Change in the Meat and Poultry Industry and the Pathogen Reduction Hazard Analysis Critical Control Point Rule," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 36747, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Hooker, Neal H. & Teratanavat, Ratapol P. & Salin, Victoria, 2005. "Crisis management effectiveness indicators for US meat and poultry recalls," Food Policy, Elsevier, vol. 30(1), pages 63-80, February.
    6. Ollinger, Michael, 2009. "The Cost of Food Safety Technologies in the Meat and Poultry Industries," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 48783, Agricultural and Applied Economics Association.
    7. Yao, Liufang & Parlar, Mahmut, 2019. "Product recall timing optimization using dynamic programming," International Journal of Production Economics, Elsevier, vol. 210(C), pages 1-14.
    8. Adalja, Aaron & Lichtenberg, Erik, 2018. "Produce growers’ cost of complying with the Food Safety Modernization Act," Food Policy, Elsevier, vol. 74(C), pages 23-38.
    9. Peyton M. Ferrier & Jean C. Buzby, 2013. "The Economic Efficiency of Sampling Size: The Case of Beef Trim," Risk Analysis, John Wiley & Sons, vol. 33(3), pages 368-384, March.

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