Liability and food safety provision: Empirical evidence from the US

Abstract

Recent environmental and food safety incidents are bringing attention to regulatory regimes and their effects on care provision. This article investigates the effects of the application of liability regimes with punitive damages in the reduction of food contamination episodes in the United States from 1990 to 2000. The main result is that the application of strict liability laws allowing claims of punitive damages decreases in a statistically significant way the number of food safety incidents. Statistical results show that states allowing claims of punitive damages are between 15% and 30% less likely to suffer food safety incidents.