Published: 01.07.1999 〉 Heft 7/1999 〉 Resort: Articles
Submitted: N. A. 〉 Feedback to authors after first review: N. A. 〉 Accepted: N. A.
A model of individual information processing is developed that is based on Bayes' Rule and takes account of the specific conditions of food safety evaluation. The difference in the reliability between single types of suppliers, as perceived by the consumer, are captured by subjectively assigned failure probabilities. These failure probabilities determine the change in consumer confidence after receiving information about the safety of a supplier's products. The central implication resulting from the model analysis is that suppliers should not attempt to discriminate against other suppliers on the grounds of food safety in order to gain competitive advantage. It is shown that, as the subjective failure probabilities of other suppliers in creases:(i) the likelihood that the products of the discriminiating supplier be bought decreases even in the absence of product failure,(ii) the loss in consumer confidence after product failure increases, too, thus further decreasing the likelihood of such a product being bought.Furthermore it is shown that a very small subjective failure probability as signed to reliable suppliers, which is a precondition for product purchase, makes it generally more difficult to regain consumer confidence after product failure.