| From the perspective of economics, food safety issues are not only resulted fromthe market failure caused by information asymmetric, but also aroused fromgovernment failure caused by incentive incompatibility of regulation system. Focusedon the current situation of our country, the discredit of food industry leads to foodsafety issues directly, while the invalidity of regulation regime is the primary causebehind the scene. Therefore, based on a literature review of the economic study onfood safety and credit, this paper explores the influencing factors and institutionalcauses of the credit issues in food enterprise on the dimension of corporate behaviorand government regulation respectively, and proposes to construct the food creditsystem, thus providing an institutional guarantee for the credit of food corporate andfood safety standard.First, by taking the dairy industry for instance, the paper probes into the themethrough the corporate behavior. Considering the factors of industry chain suppliers,customers and the government, we construct a theoretical analysis framework toexplore the internal mechanism for credit choices of the enterprises. According tocost-benefit analysis, the results suggest the following four respects lead to theoccurrence of the discredit in the dairy industry: the lack of market incentives for theinefficiency of our social credit system, the high cost of credit due to the lowintegration of dairy industry chain, the uncritical punishment under currentinstitutional system, and the great difficulty in the protection of consumer rights.Second, based on the principal-agent theory, we create two game modelsbetween the central supervision department, the local supervision department and thefood enterprise. From the perspective of incentive compatibility, we conclude thecauses of the food safety regulation system failure: for local supervision department,the expected benefits of efforts in regulation are less than those of negligence; forfood enterprise, the expected return of credit is less than illegal earnings. To realizethe incentive compatibility of the food safety regulation, there is an urgent need todefine the arrangement of rights and liabilities in the supervision department and improve the evaluation system of regulation performance.Based on the analysis above, the paper put forward to build China food creditsystem with all parts relevant participating, which is an organization dominated by thegovernment, implemented by the enterprise and market, and assisted by the public.The system would establish both the disciplinary system and incentive system toprovide an effective institutional guarantee for food credit. |
