Meerza, Syed Imran Ali

By: Meerza, Syed Imran Ali ; Giannakas, Konstantinos; Yiannaka, Amalia
We analyze the optimal government response to food adulteration and mislabeling while accounting for heterogeneity in consumer preferences and producer efficiency, endogeneity in producer quality choices, and asymmetries in food fraud detection. When more-efficient producers commit fraud, the optimal policy response is a strict monitoring and enforcement system. For less-efficient producers, both increased certification costs and monitoring and enforcement can deter food fraud. When the government desires to increase average product quality, the optimal policy is strict monitoring and enforcement. Increasing monitoring and enforcement in the presence of corruption provides increased incentives for collusion between dishonest producers and corrupt policy enforcers.
By: Meerza, Syed Imran Ali; Gustafson, Christopher R.
This study uses a laboratory valuation experiment to examine whether food fraud occurring in one country affects the valuation of products from that country as well as products from other countries. We use a between-subject experiment design to compare consumersÕ valuation of extra virgin olive oil (EVOO) from different countries with and without exposure to information about olive oil fraud occurring in one of the countries. Results show that information about olive oil fraud in one country negatively affects the valuation of EVOO not only from that country but also from other countries, indicating negative spillover effects of food fraud.