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Essays on the Economics of Animal Welfare

Abstract

Farm animal welfare is an increasingly prominent policy priority across the world, yet the market and political forces shaping it remain poorly understood. This dissertation draws on large administrative datasets and large-scale text analyses to study the supply of, demand for, and public valuation of farm animal welfare improvements in the United States.The first chapter establishes the empirical footing for the central argument of the dissertation. I develop a structural framework to identify public-good preferences from referendum data, applying it to California's Proposition 12 (2018)---a ballot initiative mandating cage-free housing for laying hens, approved by 63% of voters despite raising egg prices. The key insight is that market purchases and referendum votes identify different equilibrium objects: markets reveal Nash-equilibrium private (use) valuation, while referenda reveal Lindahl-equilibrium total valuation, and the gap is non-use value. Combining NielsenIQ retail scanner data with precinct-level vote shares and a supply-side instrument for local cage-free prices, I find that over 85% of voters' total willingness to pay---roughly $17 of $20 per capita per year---reflects public-good (non-use) benefits that private markets structurally underprovide. The framework generalizes to any referendum in which the voter's cost is a commodity price change rather than a tax.The second chapter, coauthored with Sharon Pailler, Jon McFadden, Sharon Raszap Skorbianski, Zach Raff, and Kevin Kuruc, identifies supply-side incentives and disincentives for adopting animal welfare-improving farming practices in the United States. We conduct a scoping review of nearly 25,000 publications from EconLit, CAB Abstracts, and Web of Science, we apply Latent Dirichlet Allocation and iterative manual review to identify 74 papers meeting our eligibility criteria. Across five practice categories---indoor environment, outdoor access, enrichment, confinement, and bodily mutilation---and four species---dairy cows, layer hens, broilers, and hogs---we find that operating costs are a near-universal disincentive to the adoption of welfare-improving practices. Conversely, improved indoor environment and enrichment practices show promising benefits for animal health and productivity, suggesting interventions that need not substantially harm farm profitability. The literature is sparse, particularly for broilers and hogs and for mutilation practices, pointing to important research gaps for evidence-based policy design.The third chapter, coauthored with Carl Meyer and Zach Freitas-Groff, documents trends in the consumption of animal products in the U.S. using a panel of 40,000---60,000 U.S. households from 2004 to 2020 linked to ingredient-level product data classified via a machine-learning-based method. Despite stable or rising aggregate meat consumption, the share of households purchasing no meat in a given month rises from approximately 5% to 6.2% by end-2019, and the share purchasing no animal products rises from 0.5% to 1.3%. These trends partially reverse in 2020 as the pandemic shifts food consumption back toward food at home. The patterns predate the introduction of modern plant-based meat alternatives, whose limited market share is insufficient to explain the broader changes. Demographic heterogeneity and declining food-at-home purchase volume both appear to be important contributors. The findings reconcile persistently high aggregate meat consumption with the increasing visibility of meat avoidance.Taken together, these three chapters map the economic landscape of farm animal welfare from farm gate to ballot box. The analysis uncovers social preferences that are obscured by coordination failures and identifies critical barriers that hinder the realization of full economic efficiency. Correcting for this gap is essential for designing policy that aligns with social values.