Is This Salad Safe? Voluntary versus Mandatory Disclosure of Product Risk Characteristics

Abstract

This paper focuses on risk information campaigns familiarizing consumers with hazardous product attributes and compares policies advocating voluntary and mandatory displays of warning messages. The food allergen labeling campaign provides an opportunity to focus on the availability and visibility of a warning and to evaluate the immediate effect of different disclosure rules. Using a multivariate two-step framework, I compare food allergies to a set of control diseases. I find that voluntary allergen labeling boosts the number of outpatient allergy visits, while mandatory labeling has the opposite effect. This result demonstrates that the disclosure of product risk characteristics might adversely affect consumers' health if the disclosure policy is not chosen carefully.