Risk perception in food safety and the Value of Statistical Mild Food-Induced Adverse Reactions

This paper presents a novel approach to structurally estimating the value of eliminating mild adverse food reactions (Value of Statistical Mild Food-Induced Adverse Reactions, VSFAR) using a discrete choice experiment (DCE), without assuming objective perception of risk or any particular functional form for utility. We showcase our method using a Forthright panel of 1,190 US consumers with some type of food intolerance and find VSFAR values ranging from 22 to 229 USD per case, with substantial variation across models and consumer classes. We also find meaningful differences in likelihood insensitivity and pessimism across consumer segments, underscoring the need to incorporate flexible probability weighting functions and account for heterogeneity in preferences when valuing food-related health risks. Because our estimates are not tied to specific food items or types of adverse reactions, they can be scaled by the expected case numbers to inform societal cost estimates for mild food-borne illness or used in marketing to quantify the effect of risk reduction on the value chain of relevant products. • Introduces the Value of Statistical Mild Food-Induced Adverse Reactions (VSFAR) as a novel metric for valuing reductions in mild food-related health risks. • Uses a discrete choice experiment to elicit preferences under varying probabilities of mild adverse reactions and associated costs. • Incorporates multiple probability weighting functions (linear, Prelec, Goldstein & Einhorn, and Neo-additive) to account for non-linear probability perception. • Applies latent class models to capture heterogeneity in preferences, likelihood sensitivity, and optimism/pessimism. • Finds that VSFAR values are significantly lower than those for other minor health risks, and vary by demographics and whether decisions are made for oneself or others.