Costs and Benefits of Compliance for HACCP Regulation in the Italian Meat and Dairy Sector

Abstract

In the last years food safety issues have became more and more important in the UE. Recent food scares have given rise to a demand for regulations able to guarantee healthy foods for consumers and prevent food-borne diseases. Public agencies involved in food safety regulations need information about costs and benefits of the implemented measures, in order to assess the impacts on welfare and to improve the necessary tuning of their policies. Notwithstanding a general agreement on the need of measures to correct market failures in providing safe foods, different views have arisen with respect to the relative weight to assign to mandatory and incentive based schemes (Segerson, 1998). During the nineties, HACCP systems has been introduced as mandatory measures in some sectors of food industry (meat and dairy products); moreover the compliance to the HACCP system has became a minimum standard to access to the food market, often within broader voluntary quality systems (ISO 9002, BRC standards, product certifications and so on). Cost and benefits of HACCP system have been the object of a great deal of investigations in the USA (see for example Golan et al., 2000; Unnevehr, 2000). On the contrary, apart from some explorative research (se for instance: Henson et al., 1999) at the European level there is actually a lack of systematic information to support policy assessment. This paper presents some preliminary results of a study aiming at assessing the economic impacts of firm compliance to HACCP regulation in the meat and dairy sector in Italy. This work is based on a survey that provided for both quantitative and qualitative data at firm level for 4 case studies. The structure of the paper is as follows. After a short discussion of the main issues concerning the analysis of cost and benefit of food safety at the firm level (section 2) and an introduction to the adopted methodology (section 3), the case study is presented (section 4). Then, the main findings of the analysis of HACCP compliance costs (section 5) as well as of the perceived benefits (section 6) at the firm level are discussed. Finally, concluding remarks and some suggestions of possible improvements of the HACCP systems are reported (section 7).