Economics of Animal Welfare Standards: Transatlantic Perspectives

Some economists suggest that the provision of a sufficiently high level of farm animal welfare is a public good that will not be forthcoming because of market failure. Others argue that it is a merit good whose provision is desirable on the basis of some concept of need or justice. These concepts lead towards assigning government the primary role in ensuring welfare standards. We argue that animal welfare should be treated as a moral good-one for which a state imposed minimum standard is necessary to meet society's demand for humane treatment, but where there is also a role for markets in satisfying the preferences of some consumers for higher welfare standards. Historically, Europe has tended to rely largely on legislation to raise welfare standards. The United States has tended to rely largely on private initiatives. On both sides of the Atlantic, there is strong evidence of movement to a mixed approach involving minimum legislated standards and products differentiated on the basis of higher welfare standards. This change in emphasis is to be welcomed as a means of providing an effective way of ensuring humane treatment of farm animals, while simultaneously satisfying diverse consumer preferences for animal products.