[Federal Register Volume 67, Number 61 (Friday, March 29, 2002)]
[Notices]
[Pages 15169-15171]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-7631]


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DEPARTMENT OF AGRICULTURE

Economic Research Service


Notice of Intent To Seek Approval To Collect Information

AGENCY: Economic Research Service, USDA.

ACTION: Notice and request for comments.

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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.

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

ADDRESSES: 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 [email protected].

FOR FURTHER INFORMATION CONTACT: Katherine Ralston, 202-694-5463.

SUPPLEMENTARY INFORMATION:   
    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

[[Page 15170]]

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  x  2400 respondents) plus Part B--1000 
hours (500 respondents  x  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

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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