I’m (as you know) a big fan of SWP <3, but I’m not really understanding the idea here. I’m walking through a few potential setups to try and get a handle for this below. I assume I'm just misunderstanding the key idea!
A: Is the idea to get the supermarkets to pay you to set up more stunners elsewhere?
I.e. you get Big Supermarket to commit to doing stunning, and to fulfill that promise it agrees to buy 10 stunning credits per year from SWP, but otherwise doesn’t change their existing supply chain.
Let’s say 1 credit = ‘Operating 1 stunner at normal capacity for 1 year’
And you sell credits to cover the prorated set-up & operating costs of a stunner for 1 year
You take that money and then go find a bunch of producers (who have existing customers), and get them to take up the stunner.
If this is the idea, I’m wondering why money isn’t a blocker here when you elsewhere suggest that these big corporations probably aren’t willing to pay for the stunners. I’m also not sure how much scaling to new producers is a problem here, since you’d still have to play middleman by getting enough farms to adopt stunners.
B: Or maybe it’s the above, but instead of Big Supermarket paying, SWP donors foot the bill for the credits? If so, I’m confused how this improves welfare. Feels a bit like telling the supermarkets, “Hey! Want to purchase some paper from us that means you get to call your welfare standards good while you do nothing?”
C:Or as an alternative to A, maybe you set up a genuine marketplace where supermarkets can buy credits from producers, i.e. more similar to carbon credits.
If so, feels like there are obvious perverse incentive problems. E.g. dumb hypothetical:
Tesco wants to buy a bunch of stunning credits
Bunch of people set up shrimp farms even though there’s not the demand for it, stun the shrimp, bank the money, then discard the shrimp / sell it at super low prices. ⇒ In which case, this seems worse than the counterfactual!
I feel like a key difference between carbon credits & shrimp stunning is that reducing carbon is actually “good”, but stunning shrimp is “bad” (it’s only good relative to the counterfactual). Because of this I generally feel nervous about perverse incentive problems here!
Okay, re-reading 'How it works', seems like somewhere between A and C? I think I still don't understand whether there are funky perverse incentive problems going on here, but hopefully someone with more direct market design knowledge can weigh in :)
With Paul's, the egg certificate solves a problem of "I want humane eggs, but I can buy regular egg + humane cert = humane egg". Maybe the same would apply for stunned shrimp, eg a supermarket might say "I want to brand my shrimp as stunned for marketing or for commitments; I can buy regular shrimp + stun cert = stunned shrimp"
I am not sure this helps you, but I think the idea is as follows. Some retailers would like to be resposible for electrically stunning more shrimp, but have suppliers which are not willing to do so. Those retailers could buy stunning credits as a way of certifying they have been responsible for electrically stunning more shrimp by paying other suppliers to do so. These suppliers may initially be uncertain about whether those retailers will buy their stunning credits, so SWP commiting to buying their credits would make them more willing to electrically stun more shrimp.
Apologies for all the confusion here - in terms of the idea I'm presenting in the post I think Vasco has done a really great job of summarising the idea above.
But I think the conversation above has helped me recognise a distinction that I don't think I'd articulated particularly well in my post, which is that I see a difference between the application of credits for contexts like shrimp stunning, and the wider application of credits for animal welfare more broadly:
As a transition tool(as in shrimp stunning credits) - In the case of offsetting "bad" practices, credits aren't intended to be very valuable, just a way to unblock logistical issues of transitioning a supply chain. Ultimately we want a situation where no-one is buying stunning credits because they've all directly transitioned their supply chains. (Again, I think Vasco actually does a great job of outlining my sense of how this would work without increasing shrimp production in his comment below).
As a tool to put a price on positive welfare (similar to Paul Christiano's Demand Offsetting proposal - thanks @Austin! I hadn't read this article before) - In cases of trying to optimise for "good" practices (where an improvement could lead to net positive lives for farmed animals), I wanted to paint a picture of a world where credits could be used to create lasting mechanisms that financially incentivise these welfare improvements.
Also, I've just realised that I've referenced @Vasco Grilo🔸's comments a few times in this reply to help clarify my thinking - just wanted to say that I really appreciate your help in articulating the points I wanted to make!
Also, I've just realised that I've referenced @Vasco Grilo🔸's comments a few times in this reply to help clarify my thinking - just wanted to say that I really appreciate your help in articulating the points I wanted to make!
I am optimistic about this sort of idea, but I agree that it's important to pay close attention to perverse incentives. For what it's worth, the paper referenced in the post says the following regarding increased quantity concerns in the imagined animal well-being units (AWBUs) market:
"As can be seen from Table 2, a producer has three options to increase the number of AWBUs produced—it can add more animals, increase well-being, or avoid discount factors. The incentive for all farms to improve animal well being is straightforward. The higher the price of AWBUs, the greater the incentive to improve animal care. It seems unlikely, however, that a farm would face much pressure to add more animals simply to increase the number of AWBUs produced unless there was a corresponding change in demand for meat, milk, or eggs. Moreover, a producer only faces positive incentives to add more animals if conditions on the farm are such that NAWBS were to able to established at a high level. And isn’t this exactly what animal advocates desire? Indeed, if it became more profitable to produce animals on farms by providing conditions that delivered high levels of animal well-being (which would increase production on such farms), there would likely be a corresponding decrease in the level of production on farms with low levels of animal well being. Thus, the anticipated effects of a market for AWBUs are:
The average level of animal well-being across all farms, as defined by the average NAWBS, will increase;
There will be a slight increase in the number of animals produced;
There will be a redistribution of where animas were produced; more animals will begin to be produced on farms with higher NAWBS; and
Each of the above affects will be accentuated as the price of AWBUs rises."
There are a few typos in that section that I left in ("such that NAWBS were to able to established," "animas," and "affects," presumably intended to be "such that NAWBS were able to be established," "animals," and "effects." I'm not sure why there are so many small errors, in addition to at least one other earlier in the paper.
The claims seem plausible to me, but far from obviously true. A lot seems to be resting on "Indeed, if it became more profitable to produce animals on farms by providing conditions that delivered high levels of animal well-being (which would increase production on such farms), there would likely be a corresponding decrease in the level of production on farms with low levels of animal well being." I think it's possible that some producers of cheap products cannot easily upgrade facilities to get paid for the credits (which would likely increase high-welfare production less than or equal to the corresponding decrease in low-welfare production), and they may not decrease production 1:1 even if their low-welfare products lose value in the market (I think empirical studies on elasticity in these markets generally indicate this). They may continue to produce, for example, if marginal revenue covers variable costs and some, but not all, fixed costs.
How positive the credits system ends up being depends on the actual changes in the number of animals being produced at different welfare levels. If even low-cost producers respond by implementing relatively cheap but highly welfare-improving measures, things will go swimmingly. If there ends up being more separation between producers, things could get messy. I think a lot may depend on the specific market -- how similar production is across borders, supply elasticities, and what the lowest-cost changes available are.
I think the credits could be set up such that farmers would profit from electrically stunning more shrimp, but not from increasing shrimp production. For example, if conventional and electrically stunned shrimp marginally costed 10 and 10.1 $/kg, the credits could cost just slighty more than 0.1 $/kg (= 10.1 - 10). If conventional shrimp marginally costed 10 $/kg, it would not make sense to increase production to sell credits at slightly more than 0.1 $/kg if the additional electrically stunned shrimp were not bought by consumers, because this would result in a marginal loss of slightly less than 9.90 $/kg (= 0.1 - 10).
But then we have the issue of an audited supply. For GFP, this was solved through certification schemes, but there is currently no certification scheme for stunned shrimps. This is where we’re hoping Precision Aquaculture ["on-farm continuous data monitoring"], or Precision Welfare, can come into play.
I am not a fan of the term precision welfare. It makes it sound like data is being monitored with the purpose of increasing welfare, whereas I assume the goal is very often increasing profit regardless of whether welfare is made better or worse.
Certification schemes are slow to adapt to changes and often have an unusual incentive structure where their customers are the producers themselves, so trying to be too innovative or progressive can cost them business.
The organisations ensuring the shrimp were electrically stunned, via precision aquaculture or other methods, would in practice be certifiers. I understand certifiers cannot be too innovative, but this applies to both current certifiers, and prospective ones that would rely on precision aquaculture.
We think Precision Welfare could be another way of verifying that the shrimps have been stunned. Installing devices onto shrimp stunners, for example, could automate the tracking of stunned shrimps. Once a shrimp has been stunned, we can verify that it has been stunned and generate a unique credit. Another reason I’m excited about this is that it incentivises the installation of tracking devices on farms and automates the transfer of that data to a verifiable 3rd party database.
Producers will have an incentive to put shrimp which is not fit for consumption (for example, which died before slaughter time) in the electrical stunners to earn more stunning credits. Ideally, one would only assign credits to shrimp fit for consumption. I assume this can be done by ensuring the shrimps were moving before they are electrically stunned. In addition, no shrimps moving afterwards is a necessary condition of effective stunning, but I guess it is not sufficient.
As this is already the prevalant method of trading shrimps in the industry, we assume that credits will be assigned per kg, rather than per shrimp.
I wonder whether assigning credits per shrimp would be worse than per kg. Assigning credits per shrimp would incentivise farmers to slaughter more shrimp, which can be achieved by slaughtering shrimp at a younger age when they are smaller. It is unclear to me whether this would be good or bad, as I do not know whether the last stages of shrimps' lives before slaughter are better or worse than a random moment of their lives before slaughter. On the other hand, I guess the growth rate of shrimps slows down as they age, such that slaughtering younger shrimp would imply an increase in shrimp-years/shrimp-kg, and therefore a larger population of shrimps. I believe this would be bad because I estimate shrimps have negative lives, even with electrical stunning.
Precision Welfare - I appreciate your feedback here. I've had some positive responses from industry folks on this term, but I'm not locked into the specific language around this just yet - do you have any thoughts on other ways to frame this idea?
Certifiers - That's true. I guess the wider point I wanted to make here is that I think people are locked into a particular view of what certification looks like - and I think there is a lot of scope for ways to reimagine certification that is more innovative and responsive.
False credits - Yep good point. I think requiring more monitoring on farms to verify that producers aren't falsifying credit generation would be a good thing. This is actually one of the reasons why we're interested in Precision Aquaculture technology here - having automated sensors that could detect both pre-stunning movement and effective stunning outcomes would create a more robust verification system than relying solely on periodic inspections or self-reporting.
Per shrimp / per kg - Producers sometimes do "partial harvests" throughout a crop (to recoup losses in case of a future disease outbreak, or to reduce biomass so that the remaining shrimps can grow larger without straining the pond's carrying capacity, etc.). So my assumption (if we paid on a per shrimp basis) would be that it would incentivise farmers to stock higher at the beginning - then do a partial harvest as soon as feasible to generate credits - then continue to grow the remaining shrimps until the full harvest. Also, I think meeting the industry "where they're at" is often useful - if the industry already trades on a per kg basis, it makes it much easier to integrate credits into this system if we also use per kg.
Thanks for clarifying, Aaron! All of that makes sense to me.
Precision Welfare - I appreciate your feedback here. I've had some positive responses from industry folks on this term, but I'm not locked into the specific language around this just yet - do you have any thoughts on other ways to frame this idea?
I wonder whether sticking to precision aquaculture would be better due to being more neutral with respect to how good or bad it is in terms of welfare, although I guess it is less appealing to industry for this same reason.
Executive summary: Shrimp Welfare Project proposes a novel “Shrimp Stunning Credits” system—modeled on carbon and cage-free egg credit markets—as a potentially high-impact, albeit uncertain, solution to incentivize shrimp producers to adopt pre-slaughter stunning, thereby improving shrimp welfare at scale.
Key points:
Current incentives fall short: Despite subsidizing equipment, producers and buyers remain reluctant to adopt shrimp stunning due to weak market demand and entrenched supply chains.
Credit systems as a model: Inspired by carbon offsets and Global Food Partners’ cage-free egg credits, the post explores decoupling stunning from shrimp sales by developing tradable “Shrimp Stunning Credits.”
Enabling infrastructure: To verify stunning and generate credits, the team envisions using Precision Aquaculture tools (e.g. sensors and automated data systems) instead of traditional certification schemes.
Kickstarting the market: Shrimp Welfare Project plans to act as both the facilitator and initial buyer of credits to create demand and stimulate producer adoption.
Cost-effectiveness and risk: The approach is high-risk, high-reward—credits may not be resold, but even without resale, early adoption could justify the investment.
Broader vision: The credit system could eventually apply to other welfare metrics, animal species, or even enable individual donors to fund welfare improvements through a public Animal Welfare Marketplace.
This comment was auto-generated by the EA Forum Team. Feel free to point out issues with this summary by replying to the comment, and contact us if you have feedback.
This is a crosspost from the new Animal Welfare Alignment Newsletter by Anima International. You can subscribe on Substack if you are interested in following these efforts. Audio reading also available on Substack.
The goals of this post are to:
1. Raise a question I see as crucially important to the goal of aligning AI to animal welfare...
Hello! I'm Justin Portela. I got hired by GWWC to make YouTube videos after AI in Context did such a kickass job.
My channel is using that same cinematic, high-production value beauty to talk about everything in the EA universe that isn't AI.
...
This is a linkpost for Request for Proposals: Research and Applied Work on Digital Minds.
I'm glad to announce a request for proposals for research and applied work on digital minds at Longview Ph...
How do we create the incentives for the market to shift to pre-slaughter stunning?
The suffering shrimps experience at the end of their lives can be reduced by rendering them unconscious prior to slaughter through the use of electrical stunning technology. However, producers currently have very little incentive to implement pre-slaughter stunning as it’s expensive and few buyers require it. Even relatively forward-thinking retailers often can’t push an initiative through internally without some leverage (as they need to be able to convince their higher-ups that this is something worth doing and to persuade their suppliers to invest in the technology).
To solve this, we buy stunners for producers if they commit to stunning a minimum of 100 million shrimps every year and have a buyer (such as a supermarket) who commits to buying those stunned shrimps.
However, even though our intervention removes some of these barriers to implementation, we often get responses from the industry such as:
...we have consulted our sales teams and they do not see that the market demands this type of solution at the moment. Therefore, this issue will not be a priority for 2025.
Currently, the main incentive we can provide is through an “early mover advantage” - being able to access a free stunner if they believe this is going to be a market requirement in the future.
Market Transition
How do we deal with the Supply/Demand problem when transitioning a market?
A big problem when transitioning a market is that supply is slow to grow without demand, and demand can’t really exist without supply. In other words, it can be hard for a retailer to commit to only buying stunned shrimps if they are not able to source stunned shrimps.
Similarly, a producer likely won’t start stunning shrimps until there is a clear demand to do so. Often, buyers and sellers have strong relationships, so switching suppliers usually isn’t simple. Buyers also typically don’t know the reality of supply and, in many cases, just don’t have the direct leverage to ask for the transition. So for most producers we work with, they’ve only committed to stunning a certain percentage of their supply (usually the minimum amount we require), and yet have many more shrimps they could stun.
We need to figure out how to incentivise producers to want to stun more shrimps and to enable retailers to access stunned shrimps without needing to change their supply chains.
Strategy
Existing Policy Tools
In 2011, Jayson Lusk published a paper titled The Market for Animal Welfare. In it, he argues that existing policy tools aimed at improving farm animal welfare (specifically meat taxes, process regulations, and labeling/certification schemes) often fall short due to various economic and behavioural limitations.
Process regulations, such as banning specific farming practices, can unintentionally encourage producers to adopt alternative methods that might not substantially improve animal welfare, and without broader market controls, may simply shift production to less regulated regions.
Meat labels and certifications typically only influence a niche market of ethically motivated consumers willing to pay higher prices, thereby limiting their effectiveness in addressing animal welfare issues across the broader industry or influencing consumers who prioritise price or abstain entirely.
Meat taxes, though intended to reduce meat consumption and thus indirectly improve animal welfare, often disproportionately impact lower-income groups, encounter significant political resistance, and do not directly compel producers to adopt higher welfare standards.
Instead, he proposes to create an index of animal welfare being produced on the farm and assign "credits" based on production that can be sold in a newly constructed market. Which brings us to...
Cage-Free Impact Incentives
Another organisation trying to tackle this Supply/Demand problem isGlobal Food Partners (GFP). They were struggling to convince companies in Asia to switch to cage-free.
Low supply of cage-free eggs: Most commercial eggs in Asia come from conventional battery cage systems, and cage-free production may not meet demand.
Product identity and traceability: Preserving the identity of cage-free eggs in Asia's complex supply chain is complicated and expensive.
Transportation costs & lack of infrastructure: Low volumes of cage-free eggs in nascent markets limit economies of scale and necessary infrastructure.
Disease & flock health: Limited cage-free egg producers increase the risk of supply disruption due to disease outbreaks and flock health issues.
High cost: Traceability issues, supply chain complexities, and limited supply drive up the cost of cage-free eggs.
Time constraints: Farms need to be set up immediately to ensure sufficient egg availability by the end of 2025.
Their solution was to look to other industries, and they were inspired by innovations inaviation fuel andpalm oil. In other words, bringing the concept of “Credits” to animals. Essentially, through the use of Cage-Free Impact Incentives, food businesses can offset their use of caged eggs and fulfill their commitments on time, even in challenging markets.
For credits to work, GFP realised that they would need the following three things:
A facilitator of the credits: in this case, this is the role that GFP itself would play.
Buyers for the credits: GFP worked with corporates in Asia to commit to buying credits in order to fulfill their cage-free commitments.
And access to an audited supply chain: Essentially, a way to verify that these eggs are actually cage-free. Fortunately, there are now a number of certification schemes that can audit for cage-free.
Shrimp Stunning Credits
So, inspired by Global Food Partners, we think a similar system of Market Incentives (or “Shrimp Stunning Credits”) could be the answer to our problems. Essentially, we want to decouple the stunning from the physical product being sold, allowing companies to register, buy and trade stunning credits separately from the stunned shrimps themselves. This has multiple benefits:
It achieves direct impact: With credits, suppliers can be incentivised to stun additional shrimps, even if the direct buyers of those shrimps don’t care if they’re stunned.
It demonstrates market demand: By creating a system where stunning credits can be bought, we can support the development of stunned shrimps globally by accelerating investment and de-risking the adoption of stunners (or stunner policies) for both producers and buyers.
Buying Credits
Credits seem to help solve the Market Transition problem, but not necessarily the Market Incentives problem. We think that Shrimp Welfare Project buying credits could help solve the incentives problem.
We’re excited about credits because one of the big insights we had while developing our current strategy of buying stunners in the first place was the realisation that with some ideas, we could “pay for welfare at scale”. We think the idea of developing the infrastructure for stunning credits could be impactful on its own, but we want to take our “buying welfare” approach to stunners and also apply it to credits, both setting up the infrastructure and also being the first buyers of credits.
Ultimately, the goal would be to sell these credits back into the system, but we want to kickstart the adoption of credits by just being a big buyer right out of the gate.
Precision Aquaculture
We need to ensure that only verified supply is being credited. GFP solves this problem through certification, but this isn’t currently available for shrimps. We think that the emerging use of on-farm continuous data monitoring (or Precision Aquaculture) can solve this problem.
If we go back to the three things that GFP discovered needed to be in place for Credits to work, we can apply this to shrimp stunning:
We’d need a facilitator of the buying of credits - as before, this is the role that us as the NGO will likely take.
For buyers, our hope is that corporates will fill this role in the future, but in the beginning, this will also be a role that Shrimp Welfare Project will play to stimulate the market demand.
But then we have the issue of an audited supply. For GFP, this was solved through certification schemes, but there is currently no certification scheme for stunned shrimps. This is where we’re hoping Precision Aquaculture, or Precision Welfare, can come into play.
Certification schemes are slow to adapt to changes and often have an unusual incentive structure where their customers are the producers themselves, so trying to be too innovative or progressive can cost them business.
We think Precision Welfare could be another way of verifying that the shrimps have been stunned. Installing devices onto shrimp stunners, for example, could automate the tracking of stunned shrimps. Once a shrimp has been stunned, we can verify that it has been stunned and generate a unique credit. Another reason I’m excited about this is that it incentivises the installation of tracking devices on farms and automates the transfer of that data to a verifiable 3rd party database.
Cage-Free Impact Incentives
Shrimp Stunning Credits
Facilitator
Global Food Partners
Facilitator
Shrimp Welfare Project
Buyers
Corporates
Buyers
Shrimp Welfare Project ⇒ Corporates
Auditing
Certifiers
Auditing
Precision Aquaculture
How it works
To try to pull this all together into a cohesive picture:
Data Collection: Sensors on stunners capture key parameters (e.g., voltage, duration, shrimp movement pre/post-stun).
Data Transmission: Data is securely sent to and stored in a blockchain-based or centralised "Credits Registry" for auditability.
Credit Generation: Once a batch of shrimp is verified as stunned, a unique Shrimp Stunning Credit is automatically generated and linked to that batch.
Shrimps are typically sold by "count", which refers to the number of shrimps per kg (so 100 count refers to a batch of shrimps who each weigh ~10g, 30 count refers to shrimps weighing ~33g, and so on).
As this is already the prevalant method of trading shrimps in the industry, we assume that credits will be assigned per kg, rather than per shrimp.
Credits Registry: The credits are stored in a registry, which notes key information about the credit (i.e. where the shrimps were stunned, who owns the credit currently etc.)
Shrimp Welfare Project buys credits: Shrimp Welfare Project will be the first buyers in this credit marketplace, creating the immediate financial incentive for stunning / credit adoption.
(Future) Retailers buy credits: From either Shrimp Welfare Project, or from producers directly (via a Credits Registry).
Reporting on commitments: This also enables retailers to report progress toward fulfilling their stunning commitments, though it's important their claim language is accurate and in line with their supply chain model (i.e. "Supporting the adoption of pre-slaughter electrical stunning")
Further thoughts
Cost-Effectiveness
We think the impact per $ of this could range significantly, depending on whether we’re ultimately able to sell our credits back to the market.
Obviously, there are a number of uncertainties we have around this idea, and we would probably need to hire someone full-time for this project if we were to take it on. For example, we don’t currently know how much we should charge per credit. And our default cost-effectiveness of buying the stunners has a nice built-in yearly impact multiplier. But with credits, we’d be paying on a “per kg” basis, not a “per shrimp per year” basis.
Though ultimately, the cost-effectiveness doesn’t need to be the same, as our hope would be that we can sell these on in the future to retailers. This idea is kind of high-risk, high-reward in terms of impact. The potential impact of shrimps per dollar would be within a range - from us never re-selling a credit to us selling back all credits. But we’re also of the opinion that this could be cost-effective even if we never sell back any credits (due to having accelerated adoption of stunners).
Expanding Credits
An exciting recent development in the area of donor offsetting for the animal space is FarmKind’s “Compassion Calculator”. Essentially, they ask consumers to enter some numbers to calculate the impact of their diet, and then provide them with a number they can donate to offset the impact of their diet. This started as a small feature on their website but quickly became one of their most effective tools for engaging new donors. In particular, it seems to work because:
It decouples action from diet change by reducing defensive reactions and cognitive dissonance that often prevent engagement with animal welfare issues.
And it enables broader advocacy. The donation-focused message provides a way for influencers to discuss helping farm animals without making their audience defensive or uncomfortable.
There are a number of ways credits could expand in the future in the animal welfare space. Firstly, I think Shrimp Welfare Project could find uses for credits outside of shrimp stunning. In particular, once we develop our welfare outcome metrics, this seems like a very useful horizontal application of this idea.
But it doesn’t need to stop at shrimps (or cage-free); we could apply it to other animals. Using Precision Aquaculture / Precision Livestock Farming could be a means of bypassing certification schemes by getting tracking data on farms and pumping it into verifiable 3rd party systems. If done correctly, credits could create a price premium within the industry that generates an active market demand for animal welfare.
Finally, both of these solutions still require NGOs or corporations to be the buyers of the credits, but what if there was an Animal Welfare Marketplace where credits could be bought directly by donors themselves? This takes the idea of “offsets” and makes it much more direct. People could even opt to offset the consumption of others - no longer requiring people who consume animal products to also be willing to pay more for their welfare, this willingness to pay can come from elsewhere.
How You Can Help
The Shrimp Stunning Credits idea is still in its early stages, and we could really use some help from people with relevant skills. If you've got experience with blockchain, sensor tech, data analytics, or have worked with similar credit systems (like carbon credits), I'd love to chat! Feel free to email [email protected] if you think you might be able to contribute (I'll also be at AVA (US) and EAG London in the coming weeks if you'd prefer to chat in person).
I’m (as you know) a big fan of SWP <3, but I’m not really understanding the idea here. I’m walking through a few potential setups to try and get a handle for this below. I assume I'm just misunderstanding the key idea!
A: Is the idea to get the supermarkets to pay you to set up more stunners elsewhere?
B: Or maybe it’s the above, but instead of Big Supermarket paying, SWP donors foot the bill for the credits? If so, I’m confused how this improves welfare. Feels a bit like telling the supermarkets, “Hey! Want to purchase some paper from us that means you get to call your welfare standards good while you do nothing?”
C: Or as an alternative to A, maybe you set up a genuine marketplace where supermarkets can buy credits from producers, i.e. more similar to carbon credits.
Okay, re-reading 'How it works', seems like somewhere between A and C? I think I still don't understand whether there are funky perverse incentive problems going on here, but hopefully someone with more direct market design knowledge can weigh in :)
I'm also not sure if this is what SWP is going for, but the entire proposal reminds me of Paul Christiano's on humane egg offsets, which I've long been fond of: https://sideways-view.com/2021/03/21/robust-egg-offsetting/
With Paul's, the egg certificate solves a problem of "I want humane eggs, but I can buy regular egg + humane cert = humane egg". Maybe the same would apply for stunned shrimp, eg a supermarket might say "I want to brand my shrimp as stunned for marketing or for commitments; I can buy regular shrimp + stun cert = stunned shrimp"
Hi Angelina and Austin,
I am not sure this helps you, but I think the idea is as follows. Some retailers would like to be resposible for electrically stunning more shrimp, but have suppliers which are not willing to do so. Those retailers could buy stunning credits as a way of certifying they have been responsible for electrically stunning more shrimp by paying other suppliers to do so. These suppliers may initially be uncertain about whether those retailers will buy their stunning credits, so SWP commiting to buying their credits would make them more willing to electrically stun more shrimp.
Hi Angelina, Austin, and Vasco :)
Apologies for all the confusion here - in terms of the idea I'm presenting in the post I think Vasco has done a really great job of summarising the idea above.
But I think the conversation above has helped me recognise a distinction that I don't think I'd articulated particularly well in my post, which is that I see a difference between the application of credits for contexts like shrimp stunning, and the wider application of credits for animal welfare more broadly:
Also, I've just realised that I've referenced @Vasco Grilo🔸's comments a few times in this reply to help clarify my thinking - just wanted to say that I really appreciate your help in articulating the points I wanted to make!
Thanks, Aaron!
I am optimistic about this sort of idea, but I agree that it's important to pay close attention to perverse incentives. For what it's worth, the paper referenced in the post says the following regarding increased quantity concerns in the imagined animal well-being units (AWBUs) market:
"As can be seen from Table 2, a producer has three options to increase the number of AWBUs produced—it can add more animals, increase well-being, or avoid discount factors. The incentive for all farms to improve animal well being is straightforward. The higher the price of AWBUs, the greater the incentive to improve animal care. It seems unlikely, however, that a farm would face much pressure to add more animals simply to increase the number of AWBUs produced unless there was a corresponding change in demand for meat, milk, or eggs. Moreover, a producer only faces positive incentives to add more animals if conditions on the farm are such that NAWBS were to able to established at a high level. And isn’t this exactly what animal advocates desire? Indeed, if it became more profitable to produce animals on farms by providing conditions that delivered high levels of animal well-being (which would increase production on such farms), there would likely be a corresponding decrease in the level of production on farms with low levels of animal well being. Thus, the anticipated effects of a market for AWBUs are:
There are a few typos in that section that I left in ("such that NAWBS were to able to established," "animas," and "affects," presumably intended to be "such that NAWBS were able to be established," "animals," and "effects." I'm not sure why there are so many small errors, in addition to at least one other earlier in the paper.
The claims seem plausible to me, but far from obviously true. A lot seems to be resting on "Indeed, if it became more profitable to produce animals on farms by providing conditions that delivered high levels of animal well-being (which would increase production on such farms), there would likely be a corresponding decrease in the level of production on farms with low levels of animal well being." I think it's possible that some producers of cheap products cannot easily upgrade facilities to get paid for the credits (which would likely increase high-welfare production less than or equal to the corresponding decrease in low-welfare production), and they may not decrease production 1:1 even if their low-welfare products lose value in the market (I think empirical studies on elasticity in these markets generally indicate this). They may continue to produce, for example, if marginal revenue covers variable costs and some, but not all, fixed costs.
How positive the credits system ends up being depends on the actual changes in the number of animals being produced at different welfare levels. If even low-cost producers respond by implementing relatively cheap but highly welfare-improving measures, things will go swimmingly. If there ends up being more separation between producers, things could get messy. I think a lot may depend on the specific market -- how similar production is across borders, supply elasticities, and what the lowest-cost changes available are.
Hi Angelina,
I think the credits could be set up such that farmers would profit from electrically stunning more shrimp, but not from increasing shrimp production. For example, if conventional and electrically stunned shrimp marginally costed 10 and 10.1 $/kg, the credits could cost just slighty more than 0.1 $/kg (= 10.1 - 10). If conventional shrimp marginally costed 10 $/kg, it would not make sense to increase production to sell credits at slightly more than 0.1 $/kg if the additional electrically stunned shrimp were not bought by consumers, because this would result in a marginal loss of slightly less than 9.90 $/kg (= 0.1 - 10).