The Role of Public Regulations on the Emergence of Private Food Standards: an Industrial Organization Approach.

Summary This paper provides an original theoretical framework to better understand the development and economic effectiveness of private safety standards. Taking the example of the food sector and taking explicitly into account the role of consumer behavior and vertical relationships along supply chains, we analyze the interactions between private and public modes of safety risk governance. Unlike most contributions in the literature, we show that a laxity of regulation is not necessarily the dominant situation in which private standards are more likely to appear. We also show why these private standards may have positive effects for both suppliers (by improving market access and income for growers) and consumers (reducing risk and improving surplus).