Plant pathogens migrate to new regions through human activities such as trade, where they may establish themselves and cause disease on agriculturally important crops. Verticillium wilt of lettuce, caused by Verticillium dahliae, is a soilborne fungus that was introduced to coastal California via infested spinach seeds. It has caused significant losses for lettuce growers. Once introduced, Verticillium wilt could be managed by fumigating with methyl bromide and chloropicrin, but this option is no longer available. Growers can also manage the disease by planting broccoli or not planting spinach. These control options require long-term investments for future gain. Verticillium wilt can also be prevented or controlled by testing and providing spinach seeds with little or no V. dahliae infestation. However, seed companies have been reluctant to test or clean spinach seeds, as spinach crops are not affected by Verticillium wilt. Thus, available control options are affected by externalities. Renters and other producers with short time horizons will not undertake long-term investments and seed companies do not take into account the effect of their decision not to test on lettuce producers. We review the literature on the economics of managing crop disease; discuss the economics of managing Verticillium wilt; and review the recent research on the externalities that arise with short-term growers, and between seed companies and growers due to Verticillium wilt. An externality arises whenever the actions of one individual or firm affects the payoffs to another individual or firm not involved in a specific transaction. These externalities have important implications for the management of Verticillium wilt and, more broadly, for the management of migratory pathogens and the diseases they cause in agriculture in general. This review is of interest to policy-makers, the producers, marketers, seed companies, and researchers.

Quality considerations are increasingly important drivers of production and coordination choices for players in the agrofood chain. Incentive contracts between farmers and processors, shippers, and other buyers are an increasingly popular means of coordinating to improve food quality. This review examines the economic literature regarding incentive contracts and the provision of food quality, with a focus on empirical analyses. Studies of specific value chains find that a desire for higher quality or specific quality attributes increases the likelihood that a contract, rather than the spot market, is used. Consistent with economic theory, studies regarding the selection of contract provisions find that financial incentives are used when an attribute is easily observable at the time of sale, whereas requirements for specific inputs and actions tend to be used when an attribute is not easily observable.