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It is hard for some people to believe this, but markets can and do provide people with products and services produced in accordance with their values in a way in which many presume requires regulators. A lot of what we would think of as unethical behavior on the part of firms could be done away with if consumers demanded it.
I think progressives would disagree with me here by pointing to surveys that show consumers want all sorts of goods produced in accordance with progressive values that the market isn’t providing. Yes, I’m sure if you ask them, consumers say they would pay $.01 more per pound to give tomato pickers a $2 an hour raise. I’m sure people tell survey respondents they’d love organically grown food, or higher gas mileage cars, and that they would definitely pay a lot more for it, it’s just that companies are providing them. The progressive response here is that businesses must be forced, nudged, or subsidized into providing what consumers want. But what people will tell a surveyor that they want and what they say they’d be willing to pay for it doesn’t actually determine the market-wide willingness to pay. It’s what they actually would pay. This is what economists call “stated preference” versus “revealed preference”. As you can imagine, revealed preference holds a lot more weight among academics.
I think the demand for more environmentally friendly and ethical agriculture is a good thing, and will in the long-run lead to improved conditions better than what regulations alone can or would provide. Sometimes regulations can even get in the way of market outcomes that would be more in accordance with progressive values.
Case in point is slaughterhouses. A recent story in the New York Times details how a slaughterhouse shortage is stymieing a variety of local, organic, and more humane meat producers:
One might expect the Bay Area — as the epicenter of the eat-local movement and a region with a long tradition of cattle ranching — to be a mecca for producers of organic and grass-fed beef. But there is a problem: a shortage of slaughterhouses is so acute that it is stunting the growth of this emerging industry….
Slaughterhouses have been on the decline nationwide, but a demand for more niche products has led to an increase of small slaughterhouses nationwide. In California however, there remains a shortage. The story explains why:
…Mr. Thiboumery is pessimistic about the chances for new facilities in California. Here, potential operators face stringent state regulations, unforgiving zoning laws and the dreaded Nimby factor.
“Basically, if I were to build a slaughterhouse, the last place I would build it is California,” Mr. Thiboumery said.
The article doesn’t go into it, but as I’ve written before, USDA regulations set equipment mandates designed for large, industrial, high volume slaughterhouses in a way that is too costly for smaller slaughterhouses ones to afford at the scale and volume demanded from them. Loosening these regulations seems like an area for cooperation between progressives and libertarians.
Of course, libertarians would argue that once you decide to set equipment standards you’re destined for regulatory capture such that the only way to really prevent this type of subtle protectionism is to stop setting equipment standards. Progressives would counter that if you don’t set these standards, then the companies will race to the bottom and use the least safe equipment possible, the costs of which will be borne by workers. The libertarian counter-counter-point is that more dangerous conditions will mean they will need to pay higher wages, but progressives would respond….. Wait, why did I think this was a possible area for libertarian and progressive agreement again?
You might assume that animal-rights activists would be better at animal welfare than industrial slaughterhouses. I’ve recently seen two pieces of evidence this is not always the case.
First, are animal lovers that have it wrong. Officials in Valley Forge park outside of Philadelphia are planning on culling the deer population from 1,277 to under 200. Sharpshooters will kill 500 this winter and next, and 300 to 250 in the winters after that. Animal rights activists “Friends of Animals” are arguing, however, that the deer population should be culled naturally by encouraging the number of coyotes to grow. Officials are objecting because it would take a long time to bring the herd population down and require a large number of coyotes. But from an welfare perspective it’s a little strange of an argument. Surely being chased down and killed by a pack of coyotes must cause much more suffering than being picked off by a sharp shooter.
Next is the industrial slaughterhouses that have it right. Two U.S. chicken producers have begun knocking chickens out with carbon dioxide before they kill them, resulting in a lower stress and lower suffering death. One problem they are havingis that it is difficult to advertise, since buyers don’t like to be reminded that the animals are slaughtered in the first place. This is not encouraging, because it suggests that the current state of advertising is an equilibrium where all firms are hiding information about the actual slaughter. If you can’t brag that you’re being more humane because consumers want to be uninformed, then the market incentives to be more humane aren’t there.
Fortunately there are some incentives, in the form of less bruised and higher quality meat from the lower stress death. Whether motivated by this or not, some firms have made the switch to lower suffering slaughter:
A Nebraska company, MBA Poultry, which sells under the Smart Chicken brand, has been using gas stunning technology since 2005. The company does not aggressively market the technology, but a label on the back of its packages contains the phrase “controlled atmosphere stunning.” The company’s Web site mentions the technology but does not explain what it is.
In Britain, although many chicken processors use gas stunning, store packages typically do not mention it.
For what it’s worth the owner of one of the two U.S. companies that is switching certainly claims to be motivated by animal welfare concerns:
Mr. Sechler said the system he chose, after years of research, was better than similar gas-stunning systems used in Europe. Those systems, he says, often deprive birds of oxygen too quickly, which may cause them to suffer. They are also designed to kill the birds rather than simply knock them out, something that Mr. Sechler is not comfortable with.
Of course as Tyler Cowen has argued, the utilitarian approach to animal rights has it’s limits. Illustrating his point nicely was a recent op-ed in the New York Times that argued that to reduce animal suffering we should gradually eliminate all predators. To me this illustrates we must weigh other values than suffering minimization. Nevertheless, I can’t see any other values that tip the scales in the two instances I’ve discussed above. I think the animal rights activists have it wrong and the slaughterhouses have it right.