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Risk Regulation Lessons from Mad Cows

dc.contributor.authorViscusi, W. Kip
dc.contributor.authorAldy, Joseph E.
dc.identifier.citation8 Foundations and Trends in Microeconomics 231 (2013)en_US
dc.descriptionarticle published in economics journalen_US
dc.description.abstractThe mad cow disease crisis in the United Kingdom (U.K.) was a major policy disaster. The government and public health officials failed to identify the risk to humans, created tremendous uncertainty regarding the human risks once they were identified, and undertook a series of policies that undermined public trust. In contrast, the mad cow disease risk never became a major problem in the United States (U.S.). The lead time that the U.S. had in responding to the disease that was first identified in the U.K. assisted in planning the policy response to avert a crisis. The absence of a comparable U.S. crisis, however, does not imply that the U.S. risk management approach was a success. Until recently, there was no systematic assessment of the domestic risks of mad cow disease. Moreover, U.S. government agencies have never undertaken a comprehensive assessment of the benefits and costs of any U.S. regulation dealing with mad cow disease. The absence of a sound economic basis for policy is reflected in the United States Department of Agriculture’s (USDA) ill-considered decision to prohibit the private testing of beef for mad cow disease. This decision disadvantaged companies that sought such testing in order to comply with foreign testing regulations. In the absence of such testing, U.S. beef exports plummeted. One company that attempted to implement a testing program launched a legal challenge to the USDA prohibition and was unsuccessful. The policy failures in both the U.K. and the U.S. provide several lessons for regulating invasive species risks and dealing with emerging risks more generally. We conclude with a series of ten public policy lessons for dealing with similar emerging risks.en_US
dc.format.extent1 PDF (87 pages)en_US
dc.publisherFoundations and Trends in Microeconomicsen_US
dc.subjectMad cow diseaseen_US
dc.subjectRisk regulationen_US
dc.subjectPublic policyen_US
dc.subject.lcshBovine spongiform encephalopathy -- Government policy -- United Statesen_US
dc.subject.lcshBovine spongiform encephalopathy -- Law and legislation -- United Statesen_US
dc.subject.lcshFood -- United States -- Safety measuresen_US
dc.subject.lcshUnited States. Department of Agricultureen_US
dc.subject.lcshFood -- Safety measures -- Cost effectivenessen_US
dc.subject.lcshPolitical planning -- United Statesen_US
dc.subject.lcshFood -- Risk assessment -- United Statesen_US
dc.subject.lcshRisk management -- Government policy -- United Statesen_US
dc.subject.lcshFood -- Testing -- Government policy -- United Statesen_US
dc.titleRisk Regulation Lessons from Mad Cowsen_US

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