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Abstract

Food recalls need to balance speed and completeness, consumer and firm interests and thus meet managerial and social goals. Effective recalls play a vital role in protecting public health and reducing economic consequences. This paper develops a simultaneous equation model to explore the relationships among three effectiveness indicators; discovery time, completion time and recovery rate. A three-stage least square estimator is applied to control for endogeneity among these indicators. The results suggest that higher recovery rates are associated with shorter discovery times. Longer discovery times led to longer completion times. Longer completion times elicited higher recovery rates. Recalls with high risk to human health had shorter discovery times but longer completion times and lower recovery rates. Recalls issued by large plants had shorter discovery times. Large recalls and national distribution channels negatively impacted discovery times. Compared to other stakeholders, government agencies took longer to discover the problem leading to a recall.

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