Too Cheap to Eat: The Signaling Effect of Price on Food Safety

We investigate the effects on consumer’s utility of price and remaining days until sell-by date of food, using a conjoint analysis. Examples of the food products we consider in our analysis are eggs, noodles, and cookies. We find that consumers prefer foods that have a longer shelf-life. Furthermore, the result of our analysis on eggs shows that consumer’s utility increases with price, when the price exceeds a critical level. This is because consumers may perceive a correlation between a higher price and safer foods.