The Economics of Food Safety and International Trade in Food Products
By Stephen Crutchfield, Jean Buzby, Jane Allshose & Donna Roberts
ABSTRACT
This paper discusses the issue of foodborne disease from an economic perspective. Recent data from the Centers for Disease Control and Prevention show that each year diseases caused by food in the United States may cause an estimated 325,000 serious illnesses resulting in hospitalizations, 76 million cases of gastrointestinal illnesses, and 5,000 deaths each year. These diseases pose an economic burden on society: Medical costs and productivity losses from in the U.S. diseases caused by four major microbial pathogens alone are between $9.2 and $11.2 billion annually. Putting the burden of foodborne disease in an economic context is a difficult task; sophisticated economic modeling approaches must be used to estimate consumer willingness to pay for safer food. Food safety concerns may also affect trade in food products. Foodborne disease outbreaks may have lead to significant economic losses in some segments of the food sector, and lead to calls for increased protection from imported food safety risks through application of more stringent sanitary and phytosanitary rules. The new framework for adjudicating trade disputes under the General Agreement on Tariffs and Trade allows measures to protect the public from food safety risks on imported foods, but not if such measures create unnecessary trade barriers. Creating multinational trading rules that accommodate the diverse economic, cultural, and political concerns of trading partners is difficult, but new approaches to risk assessment and cost-benefit analysis of trade policies can help promote both free trade and safer food supplies.
KEYWORDS: Food Safety, Food Trade, Economics
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