An Incentive System for Salmonella Control in the Pork Supply Chain

Changes in the bacteriological threshold level lead to substantial changes in performance
measures. Expected bacteriological Salmonella prevalence decreases by 56%, and expected overall
welfare gains for the chain decrease by 17% when the plant threshold decreases from 3.5% to 1.5%.
Expected bacteriological Salmonella prevalence decreases by 91%, and expected overall welfare gains
for the chain decrease by 82% when the plant threshold decreases from 3.5% to 0.5%.

7. Concluding comments

This paper presents a dynamic principal-agent model for Salmonella control in the pork supply
chain. Analysis based on this model clearly indicates the value of evaluating the cost effectiveness of
plant and farm control measures, and trade-offs between prevalence reduction and related costs and
gains for a wide range of prevalence threshold levels. Our results show that the optimal incentive
system parameters and the overall performance in a supply chain can vary considerably with the
bacteriological threshold level.

It must be emphasized here that specific findings presented here depend on underlying
behavioral and technical assumptions and on the particular sets of farm and plant control packages
considered. While these findings might be reasonable for the Dutch pork supply chain, where slaughter
companies seek to qualify for less intensive public control for food related hazards by inspectors of the
government, slaughter plants in other EU member states may have different Salmonella prevalence
levels.

Both farm and plant control measures can be used to reduce Salmonella prevalence. The
optimal values of the producer penalty parameter are lower in this study, compared to the earlier study
of King, Backus and van der Gaag (2007), allowing plant control measures to be intensified first when
plant threshold levels fall. It is also noteworthy that the cost effectiveness of farm control package 3 is

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