Abstract
Harmful algal blooms (HAB) are an increasing global threat to food safety in the seafood industry. The impact of HABs and the losses from policies addressing them are significant. However, little is known regarding the extent to which the perceived risk of HAB affects consumers' preferences for seafood products and how this translates into welfare losses from the demand side. In this paper, we conducted choice experiments in Chile, China, and Vietnam to explore consumers’ preferences for reducing the risk of HAB contamination in a mussel consumption framework. We find that consumers strongly prefer a test that eliminates the risk of purchasing mussels contaminated by the HAB on the market in all three countries. These strong preferences translate into large WTPs. Perceptions towards HAB and mussel’s attributes play a role in explaining heterogeneity in consumers’ preferences. However, the link between perceptions and preferences varies across countries, possibly due to country-specific contexts. These results imply that the increasing occurrence of HAB globally might have caused sizable welfare losses for consumers and that policies to ensure food safety in seafood markets could significantly improve social welfare.
