Research on the effectiveness of online food safety supervision under the existence of settled enterprises’ myopic cognitive bias

Abstract

Although the scale of China’s online food industry grew rapidly in recent years, the risky operational practices of business were not adequately prohibited. Based on the repeated illegal behaviors of online food enterprises, this study constructs the intertemporal utility model of online food enterprises from the perspective of behavioral economics. It was discovered that the presence of cognitive biases with a short-term focus in online food businesses would result in dangerous food sales behavior. The myopic unsafe online food quantity deviation of businesses would decrease as the cognitive deviation coefficient and penalty factor of online food businesses increase. Due to the existence of myopic cognitive bias, it is difficult for online food businesses to perceive the difference between the discount factor in the short term and the long term during the decision-making process. Therefore, they will not choose to sell a significant quantity of dangerous food. However, during the sales behavior phase, food-settled enterprises would opt to offer more dangerous food due to myopic cognitive bias. According to the different behaviors of online food enterprises in different periods, this study provides some corresponding supervision strategies for government regulators in the near and far future. Even though government departments could act quickly to investigate and deal with food safety incidents that are less harmful, the long-term solutions to ensure continued online food safety and optimize the online business environment are to build comprehensive system of online food safety regulation, improve information disclosure of online food enterprises, and enhance the government online governance structures.