American agriculture excels at producing an abundant supply of safe, nutritious food for the Nation and the world. Despite the productivity and quality of the Nation’s food system, concerns remain about the safety and quality of the food we eat and the water we drink. In recent years, some well-publicized incidents, such as the contamination of hamburgers with the E. coli O157:H7 bacterium and residues of the pesticide Alar on apples, have led to increased public concern about the possibility of foodborne illness and exposure to potentially hazardous chemicals in the food supply. According to the U.S. Department of Agriculture’s (USDA) 1991 Diet and Health Knowledge Survey, 49 percent of primary meal preparers cited bacteria or parasites in food as the food safety issue of greatest concern. An additional 26 percent cited pesticide residues in food as their greatest safety concern. In response, the USDA has begun several broad-based efforts to make further improvements in the safety and quality of the Nation’s food supply. This report discusses the regulation of meat and poultry products from the economist’s perspective. Economics plays an important role in the public debate about food safety. Fundamental economic principles help explain why food safety problems may exist. Economic analysis of the costs of foodborne disease helps put the social burden of unsafe food into a broader perspective. Finally, economic analysis of food safety policies helps public- and private-sector decisionmakers rank policy options on the basis of expected costs and benefits.