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Notice

Notice of Intent To Seek Approval To Collect Information

Action

Notice And Request For Comments.

Summary

In accordance with the Paperwork Reduction Act of 1995 (Pub. L. 104-13) and Office of Management and Budget (OMB) regulations at 5 CFR part 1320 (60 FR 44978, August 29, 1995), this notice announces the Economic Research Service's (ERS) intention to request approval for a new information collection from the U.S. population. The study will collect data from two panels of consumers on their willingness to pay for reductions in the risk of foodborne illness using alternative risk reduction technologies.

 

Table of Contents Back to Top

DATES: Back to Top

Comments on this notice must be received by June 3, 2002, to be assured of consideration.

ADDRESSES: Back to Top

Address all comments concerning this notice to Katherine Ralston, Diet, Safety, and Health Economics Branch, Food and Rural Economics Division, Economic Research Service, U.S. Department of Agriculture, 1800 M St. NW., Washington, DC 20036-5831. Submit electronic comments to kralston@ers.usda.gov.

FOR FURTHER INFORMATION CONTACT: Back to Top

Katherine Ralston, 202-694-5463.

SUPPLEMENTARY INFORMATION: Back to Top

Title: Estimating Consumer Benefits of Improving Food Safety.

OMB Number: Not yet assigned.

Expiration Date: N/A.

Type of Request: Approval for the collection of survey data from two panels of food product consumers.

Abstract: The U.S. Department of Agriculture (USDA) has responsibility to ensure that meat and poultry products are safe for human consumption. The Economic Research Service (ERS), as the lead economic research arm of the Department, has responsibility to conduct economic research on the social benefits of policies and programs designed to reduce and prevent illnesses caused by microbial pathogens.

ERS has estimated the costs of medical treatment and lost productivity, and premature death from diseases caused by five microbial pathogens at $6.9 billion annually. These costs almost certainly understate the true social costs of these illnesses since they do not measure the consumer's willingness to pay to prevent foodborne disease. Research is needed to (1) determine the extent to which a willingness to pay approach would boost assessments of the economic value of reductions in foodborne illnesses, and (2) to identify factors that influence consumers' valuation of these reductions, including personal and household characteristics, and information the consumer receives about foodborne illness.

To date, most food-related risk valuation studies indicated that consumers would pay modest amounts in excess of the products' purchase price to decrease low-level food risks. These food safety studies observed that, contrary to theoretical expectation, the average value of risk reduction did not vary with the magnitude of risk reduction, regardless of elicitation method and type of risk. Several reasons could have caused this phenomenon. People have difficulties handling risk decisions, and some do not or cannot tell one magnitude of risk reduction from another. People also may hold a subjective threshold level of the baseline risk below which the different magnitudes of risk reduction are irrelevant. People also tend to focus their generic concern for safer food on safety levels rather than differences in the level of risk, and therefore any improvement toward complete safety is acceptable and the level of improvement does not matter. Some subjects place more weight on their risk perception than on the risk information provided during the experiment, and others simply do not pay close attention to the evaluation task when asked to reveal their willingness to pay for risk reduction.

There are two reasons why the current studies offer limited information. First, the range of alternative risk reduction strategies has been rather restrictive, limited either to a private action or a collective investment, not both. Second, with the exception of Fox et al. (JA Fox, JF Shogren, DJ Hayes, JB Kliebenstein 1998. “CVM-X: Calibrating Contingent Values with Experimental Auction Markets,”American Journal of Agricultural Economics 80(3):455-465) there has not been a direct comparison of the elicitation methods for food safety values. Fox et al. explored hypothetical-survey and actual-experimental-auction preferences for irradiated pork. Incorporating a broader set of risk reduction strategies and a direct comparison of elicitation devices will provide more understanding about the nature of expressed values, and will strengthen the validity and usefulness of evaluation results. In addition to providing refinements in valuation techniques so that empirical results are consistent with economic theory, better understanding of what the expressed values mean is an important step toward incorporating subjective value measures into policy decisions.

This pilot study will estimate consumers' willingness to pay to reduce the risk of foodborne illness using two different methods, namely contingent valuation methods and recently developed market-based methods. Two surveys will be administered to panels of consumers through the Internet. One survey (Part A) is a contingent valuation survey focusing on responses to different information about foodborne illness risk levels, severity, duration, and mortality rates. The second survey (Part B) uses a market-based method, measuring how consumers change food intake in response to risk information. The changes in consumption patterns and food expenditures of consumers receiving risk information will be used to derive the willingness to pay for reductions in foodborne illness risk.

The contingent valuation survey will be administered to a panel of food product consumers who have already been recruited to participate in multiple surveys by a private computer research firm. The survey for Part B will be administered similarly, but the computer research firm administering the survey is developing panels and will advertise over the Internet for additional participants. The panel members recruited to complete the Part A survey will receive free Internet service and monetary compensation for their efforts. The panel members recruited to complete the Part B survey will receive monetary compensation.

Administering the surveys through the Internet will reduce the burden on respondents because the survey questions can be answered more quickly by computer than over the phone or in person, and because respondents can complete the surveys at a time convenient to them. For Part A, household and personal characteristics of the participants are already available and will not have to be obtained from the survey. For Part B, the panels will be chosen to match the U.S. Census totals for cells stratified by age, gender, ethnicity, region, education, and income.

Part A: The contingent valuation survey will present a panel of consumers with information about the risk of foodborne illness associated with chicken, ground beef, and lettuce. Respondents will be asked how much they would be willing to pay for a food guaranteed to have a lower risk of contamination, where the reduction in risk is specified numerically and graphically. The panel will also receive information about the potential severity and duration of an illness if it were to occur. The results will provide estimates of the value of reductions in selected foodborne risks, spanning a range of symptom severity (including mortality) and symptom duration.

Part B: The general survey design will consist of three sections. Section 1 will elicit a person's knowledge of food safety, risk perceptions of the food-borne pathogens, awareness of alternative risk reduction technologies (e.g., HACCP, irradiation, safe food handling labels, home preparation practices), and socio-demographics. The survey will ask subjects to reveal their ordinal preferences for food safety and risk reduction technologies. Section 2 will ask consumers to report all foods eaten in the past 24 hours. Section 3 will provide the individual with a scientifically neutral description of the food-borne pathogens and the alternative risk reduction technologies. Then the individual will be asked to reveal his or her updated risk perceptions and his or her ordinal preferences for the alternative risk reduction technologies. Respondents will complete sections 2 and 3 once a week over a period of four weeks. During each round, they will be presented with information about the risks of infection from a different pathogen from a different food, which may then influence changes in food intake during the following round. The observed changes will be used to derive the ex ante willingness to pay for food safety improvements.

The results of both surveys will provide information on the sensitivity of willingness to pay to alternative information about risk levels, severity of illness, and duration as well as alternative risk reduction technologies. Those estimates can be used in comparing the benefits and costs of specific policies and regulations to improve food safety. In addition, the study will provide improved methods for estimating values of reductions in risk, which can be used to estimate the values of other reductions in risk.

Estimate of Burden: The reporting burden on each respondent completing the Part A survey is estimated to be 30 minutes, based on a trial administered to several test subjects. The burden to each respondent completing Part B is estimated to be 30 minutes per week for four weeks, or 2 hours total per respondent.

Respondents: The panel completing Part A is composed of consumers who have already been recruited by a private market research firm to participate in several surveys through the Internet. Household members primarily responsible for food shopping and preparation compose the panel for -Part B.

Estimated Number of Respondents: The study design for Part A calls for each respondent to be presented with information about each food, including one of two possible risk of illness levels, and one of three possible levels of illness duration, severity, and mortality risk. A total of 800 respondents are needed for each level; the total number of respondents is then 800 times the largest number of levels for any variable, namely three. Thus, the total number of respondents needed is 2400.

The sample size for Part B is 500. The ability to investigate the heterogeneity of consumer risk preferences is greatly enhanced the more the sampling is repeated (repeating parts 2 and 3 with additional information about pathogens and risk reduction technologies), thus reducing pooling made necessary by the sample size. Initial exploration of the survey design suggested that four was about as many repeat samplings that most potential respondents would view as reasonable.

Estimated Total Burden on Respondents: 2200 hours [Part A—1200 hours (30 minutes per survey × 2400 respondents) plus Part B—1000 hours (500 respondents × 2 hours burden per respondent).

Comments: Comments are invited on (a) whether the proposed collection of information is necessary for the proper performance of the functions of the Agency, including whether the information will have practical utility; (b) the accuracy of the Agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on those who are to respond, including the use of appropriate automated, electronic, mechanical, or other technology. Comments should be sent to the address stated in the preamble. All responses to this notice will be summarized and included in the request for Office of Management and Budget (OMB) approval. All comments will also become a matter of public record.

Dated: March 4, 2002.

Susan Offutt,

Administrator, Economic Research Service.

[FR Doc. 02-7631 Filed 3-28-02; 8:45 am]

BILLING CODE 3410-18-P

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