An Analysis of the Economic Benefit Provisions of the Food Quality Protection Act

Abstract

AbstractIn 1996, President Clinton signed into law the Food Quality Protection Act (FQPA). The act reduces the historic role economic benefits play in determining whether known carcinogenic pesticides should be granted crop labels. The Environmental Protection Agency (EPA) now considers pesticide benefits only if at least one of two conditions is present: (a) the pesticide protects consumers against adverse health effects that are greater than the health risks posed by the pesticide itself, and (b) the pesticide is needed to prevent a “significant disruption in [the] domestic production of an adequate, wholesome and economical food supply.” Congress cited an administrative action taken by the Food and Drug Administration (FDA) as an example of the type of situation that legitimately might represent a potential “significant disruption” of our food supply. The action raised the recommended ceilings for a dangerous carcinogenic mycotoxin, called aflatoxin, to reduce its impact on the availability of field corn. However, it is uncertain whether the corn/aflatoxin incident is a clear‐cut example of a “significant disruption” of our food supply. Evidence suggests that it might not be, as a drought had already destroyed a large part of the crop, and aflatoxin testing methods were inadequate. Furthermore, it is uncertain whether a strong nexus exists between crop losses caused by aflatoxin and crop losses suffered following the removal of pesticides. Several pesticide/crop combinations suggest that the nexus is not strong. The act would be more effective if economists estimated the unique crop‐loss threshold for each pesticide/crop combination.