Regulatory Oversight vs. Private Credentials: 

How Consumers Value Food Safety Signals in Emerging Food Markets (Link)

Rising restaurant prices, inflation, labor shortages, and the pandemic have accelerated a new food concept known as the home cooking movement, which allows chefs to prepare and sell home-cooked perishable food directly from private residences. In response, many states have eased regulations to permit such operations. However, regulatory oversight varies widely across states, ranging from strict licensing and inspection requirements to fully exempt frameworks to outright bans on selling home-cooked meals, creating a regulatory grey zone. To quantify how consumers value regulatory oversight and private food-safety signals across food establishments, I conducted an online survey with a random sample of 1,203 respondents using a discrete choice experiment and random parameter logit models. Results indicate consumers exhibit comparable valuations for inspected and licensed home kitchens and traditional restaurants, whereas unregulated home kitchens incur sizable market penalties. For unregulated home kitchens, private food safety credentials, particularly food handler certificates, can compensate for the lack of regulatory oversight and raise the valuation of exempt home kitchens to competitive parity with traditional restaurants. Information framing, whether altruistic or egoistic motives, had a limited influence on consumer preference for home kitchens. The results suggest that emerging home kitchens can compete effectively with traditional restaurants when equipped with appropriate regulatory oversight or credible private certifications. These findings offer policymakers evidence-based guidance for balancing food safety with entrepreneurial opportunity in this growing sector.

Suraj Gurung
surajgurung@ufl.edu
PhD Candidate in Applied Economics and Statistics
University of Florida
PO Box 110240
Gainesville, FL 32611