How to Reduce Post-Harvest Losses? A Theoretical Assessment of a Support Policy versus a Regulation Policy

The article analyzes two public policies implemented to reduce postharvest food losses: a policy based on a minimum logistics standard (MLS) imposed on producers and a policy based on subsidizing producer logistics. We propose a model of spatial differentiation where producers of perishable products are geographically located and more or less distant from a wholesale market. We assess different effects of these policies: direct effects (on food losses) and "collateral" effects (on prices and on the exclusion of producers). Compared to the situation without public intervention, the imposition of an MLS only improves the infrastructure of the producers closest to the market while a public subsidy is more effective at improving the infrastructure of producers farthest from the market. We show that public authorities may face a dilemma: i) choose an MLS that is more efficient at reducing the risk of food loss but with more negative effects on the inclusion of producers and on social well-being; ii) choose a subsidy policy that is less effective at reducing food losses but (if the level is not too high) with more positive externalities on the other criteria.