The current market price for animal welfare is zero
This is a lightly-edited memo I wrote for the 2025 Animal Advocacy Strategy Forum, which were encouraged to be highly opinionated to generate strategy discussion.
I actually wrote more about Shrimp Welfare Projectâs exploration of Credits here, but I think this 2-minute pitch for the value of Credits is useful to publish on its own.
In 2011, Jayson Lusk published a paper titled The Market for Animal Welfare:
The idea, in short, is to create a separate market for animal welfare that is decoupled from the market for eggs, meat, and milk. Farmers have a product theyâre supplying (animal welfare) that is only indirectly (and poorly) reflected in the price of food.
Animal advocacy groups have a product they want to buy (higher animal welfare) but there is currently no mechanism for them to achieve this outcome in a market setting.It is no wonder then, that they often turn to bans, litigation, and protests.
The idea is create an index of animal welfare being produced on the farm and assign âcreditsâ or âunitsâ based on production that can be sold in a newly constructed market.The idea somewhat analogous to pollution trading markets, and I argue that it could be more effective than bans on production processes (like gestation crates), meat taxes, and other policies that are currently on the table.
I reached out to Jayson and he seemed excited that someone was interested in the idea (I donât think heâd yet heard of Global Food Partnerâs Impact Incentives).
Whatâs exciting to me about the original idea of Animal Well-Being Units (AWBUs), is that the concept extends further than corporate commitments. Consumers (including Compassionate Omnivores and Vegans) could purchase ABWUs to âoffsetâ their consumption or amplify their impact for animalsâFarmKind seems to be having some traction already with this idea with their Compassion Calculator.
There are also other benefits. Being able to have a validated credit system requires some sort of auditing or tracking on farms. This could incentivize farmers to actually put tracking devices on farms. Iâm also getting more wary of certification schemes as methods of change, and having tracking devices on farms potentially just bypasses certification schemes altogether, allowing credits and welfare metrics to be validated by real-world data.
Shrimp Welfare Project wants to trial a Credits system in the context of electrical stunners, but does this still work as a model at scale? And across multiple types of AWBUs? What would an independent platform/âfacilitator of a multi-animal AWBU credits system look like?
As a final thought, ultimately this idea is just born out of trying to figure out ways in which we can directly pay for the things we wantâanimal welfare. I feel like Shrimp Welfare Projectâs breakthrough in the past was just paying for the things that we want to see on farms. We wanted to see the industry incorporate electrical stunning into its supply chains, and our big breakthrough was realising we could just pay for the stunners. This proved to be more cost-effective than we expected and has helped accelerate industry-wide momentum towards this higher welfare practice. In other words, we simply paid for the things we wanted to see on farms, and as a result, we were very quickly able to improve the lives of billions of shrimps. This direct payment approach might offer a template for animal advocates to address other seemingly intractable problems. Rather than relying solely on corporate pressure, regulation, or consumer campaigns, we can ask: what specific infrastructure, technology, or practice change do we want to see, and can we just pay for it directly?
This is a really interesting idea. But does a system like this risk increasing the number of animals being farmed?
Iâm struggling to wrap my head around the economics of it properly, but if you take it to extremes then it seems like it might?
Suppose Iâm a wealthy individual who is willing to pay a very high price to keep a hen out of a cage (more than the market price of all of her eggs over her life). Now imagine that the demand for eggs drops to zero. In the current system, farmers would stop raising hens, and animal activists would be happy. But in this new system, if it is still legal to cage hens, then a farmer could keep raising hens, threaten to put them in cages unless I pay them not to, and just throw all their eggs in the bin? Or am I misunderstanding the system?
Thatâs an extreme and unrealistic example, but just meant to illustrate that in principle paying for welfare (which is really paying someone not to do something bad) feels like it might carry a risk of increasing total amount of suffering, even if it decreases the average?
This is correct and equally but less visibly so at current margins. This would increase the profitability of animal farming and also legitimize the idea that as a farmer, my Coase-ian property rights over my animals include the right to effectively torture. I am not saying this on balance makes it bad. I donât know, but itâs extremely important to carefully think through this trade off.
This is a very thought-provoking ideaâthank you Aaron for sharing it. That said, I wonder about the analogy with carbon credits, which are based on the fungibility of carbon: one ton emitted can, in principle, be balanced by one ton absorbed elsewhere. When it comes to sentient experience, things are less straightforward.
For example, if a laying hen endures 200 hours of Disabling Pain, what would it mean to âoffsetâ that suffering? Supporting a happier life for another animal may be valuable in itself, but it doesnât reverse or neutralize the original experience. Each animal is a distinct individual, and painâunlike carbonâcannot be canceled by pleasure elsewhere.
From a practical standpoint too, the goal should be to ensure funding is tied as tightly as possible to direct improvements at the source of suffering. The risk of a credit market is that it can introduce a layer of abstraction, where the focus shifts from making a specific farm better to simply trading units of âwelfareâ to balance a ledger.
Speaking from the perspective of the Welfare Footprint approach (apologies for the self-reference), I see real potential in identifying reforms that can prevent large amounts of intense suffering in a measurable way. For instance, if evidence shows that implementing electrical stunning in a shrimp slaughter facility could avert, say, one billion hours of Disabling Pain and one hundred thousand hours of Excruciating Pain annuallyâand if that reform costs $200,000âthen this creates a clear and actionable opportunity to âpay to reduce time in intense painâ directly. That might align well with what youâre suggesting, while avoiding some of the conceptual challenges that arise from offsetting.
Really appreciate the clarity this thought reflects. And yeah FarmKind is definitely onto something IMHO! Getting people to buy what they want may take some of the analysis paralysis out of complex decisions (pay 20% more for higher-welfare eggs because of welfare? or taste?). This discussion is needed for us to move closer to the moral revolution that holds farmed animals within our moral circle.