Mechanism, Countermeasures and Industrial Spillover Effect of Agriculture Product Harm Crisis

Accurate prediction on potential damages due to a crisis on agriculture products is crucial in mitigating the consequential effects for the business, industry and government. Taking the unique characteristics of agriculture products into consideration, this article presents a modified Hotelling model for impact analysis on product price and profit. It appeared that whether the non-directly involved parties would benefit or suffer from a crisis depended on the quality of the products that caused the occurrence, as well as the production cost, actual and perceived quality of the products that were not associated in the event. Therefore, in response to such a challenging situation, the non-involved businesses should take timely and appropriate measures with specific and focused analyses to prevent or minimize possible harms from the failure experienced by their colleagues.