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This post originally appeared on IFPRI.org .
By: Tsitsi Makombe and Julie Kurtz
Vivian Hoffman, Jef Leroy, and Kelly Jones. This post originally appeared on IFPRI.org .
The lack of a reliable safe food supply in developing nations brings with it both health and economic costs. A recent article published in Agricultural Economics explores the idea that brands that can ensure the safety of their food should be able to charge higher prices for their product. This ability to earn higher profit in turn incentivizes brands to meet and maintain higher food safety standards. The authors note that this is the first study characterizing the relationship between product price and food safety in the branded product sector.
Food safety remains a significant concern in many developing countries, thanks to a prevalence of decentralized, informal food markets and low enforcement of food safety standards. Formal markets and branded food products are starting to become more common, however, allowing firms to establish themselves in consumers’ minds as providers of safe, high quality food – and potentially to charge higher prices for that food. A forthcoming article in Agricultural Economics examines this link between food safety and food prices in the context of maize flour in Kenya.
Aflatoxin, a toxin produced by the Aspergillus fungus, poses a serious health threat in developing countries. The toxin grows in a number of staple crops worldwide, such as maize, and chronic exposure can lead to liver disease, cancer, and even death. While proper testing and processing of crops can reduce aflatoxin levels in finished food products like maize flour, many developing countries lack the regulatory environment needed to enforce such testing and handling requirements.