ABSTRACT
This chapter discovers why the Food Safety Modernization Act (FSMA) has a key influence on twenty-first-century US farm and food policy. It applies Cost-Benefit Analysis (CBA) methods to understand the FSMA's economic value. CBA analysis is an impartial means for estimating a program's net economic effects. The CBA analyst must make a professional judgment on whether to estimate project costs with market prices, or with the marginal cost of production. The chief benefit of the FSMA is to create a safer and more advanced US food system. The main purpose of the Food and Drug Administration (FDA) seven rules for FSMA implementation is to create a safer and more modern food system. The equi-marginal principle is fundamental to all economics, and has particular relevance in CBA. In practice, the equi-marginal principle recommends that a decision maker employ an extra unit of a resource up to the point where the marginal cost equals the marginal benefit.
