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Firm heterogeneity in food safety provision: evidence from aflatoxin tests in Kenya

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  • Moser, Christine
  • Hoffmann, Vivian
  • Ordonez, Romina

Abstract

How can food safety be provided in the absence of regulatory enforcement? What can explain heterogeneous responses to unenforced regulation across firms when certain food safety characteristics are unobservable to the consumer? Using data from over 900 maize flour samples representing 23 distinct brands in eastern and central Kenya, this paper explores the relationship between price, brand and aflatoxin contamination. Aflatoxin is a toxin common in maize, groundnuts and other crops around the world and, while it is unobservable to the consumer, it may be correlated with other quality characteristics. We find a strong negative correlation between price and contamination rates, which is consistent with certain brands investing more in quality to avoid loss of reputational capital.

Suggested Citation

  • Moser, Christine & Hoffmann, Vivian & Ordonez, Romina, 2014. "Firm heterogeneity in food safety provision: evidence from aflatoxin tests in Kenya," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 170588, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea14:170588
    DOI: 10.22004/ag.econ.170588
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    References listed on IDEAS

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    1. Gerhard O. Orosel & Klaus G. Zauner, 2011. "Quality Diversity and Prices in Markets for Experience Goods," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 20(3), pages 709-738, September.
    2. Kirimi, Lilian & Sitko, Nicholas & Jayne, Thom S. & Karin, Francis & Muyanga, Milu & Sheahan, Megan & Flock, James & Bor, Gilbert, 2011. "A Farm Gate-to-Consumer Value Chain Analysis of Kenya's Maize Marketing System," Working Papers 202597, Egerton University, Tegemeo Institute of Agricultural Policy and Development.
    3. Fares, M'hand & Rouviere, Elodie, 2010. "The implementation mechanisms of voluntary food safety systems," Food Policy, Elsevier, vol. 35(5), pages 412-418, October.
    4. Hoffmann, Vivian & Gatobu, Ken Mwithirwa, 2014. "Growing their own: Unobservable quality and the value of self-provisioning," Journal of Development Economics, Elsevier, vol. 106(C), pages 168-178.
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    Keywords

    Agricultural and Food Policy; Food Consumption/Nutrition/Food Safety; International Development;
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