| Most foodstuffs have quality attributes that are difficult to determine prior to purchase. Thus quality assurance is an inherent problem in food exporting. Private quality assurance can succeed if exporters can credibly signal that they have much to lose from cessation of purchases. If exporters do not provide credible quality signals, and foreign importers judge food quality according to country of origin, honest exporters can suffer negative spillovers from others' cheating under either government or private quality assurance. For both economic and political reasons, the best choice between government and private quality assurance will differ between foods and importing countries. |
