Economic damages of food-safety incidents in complex markets: 2018 <i>E. coli</i> outbreak and romaine lettuce

Food-safety incidents are costly for everyone in the leafy greens industry. However, it is challenging to estimate size and distribution of these costs today's complex supply chains. Extensive use formal contracts markets such as obscures prices other terms trade from public view. Using proprietary data on sales a major processor operating retail food-service sectors, we able separately short-run damages associated with November 2018 romaine Escherichia coli advisory growershippers, processors, retailers, operators. Due fixed grower-processor contracts, growers were only minimally impacted by advisory. Processors, meanwhile, lost approximately $55.3 million price quantity impacts. Retailers incurred $14.1 losses after pulling product channels shelves. Foodservice operators less because lower offset destroying potentially contaminated products. Moving forward, best way mitigate during food-safety fast efficient traceability.