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Kosher meat tends to be more expensive than meat which is not certified as kosher because it requires special handling. Like other specialty food products, kosher meat requires the attention of trained and highly experienced professionals, and it also needs the attention of a religious officiant who can confirm that the meat conforms with Jewish dietary law or kashrut. The rules surrounding meat in the Jewish tradition are quite complex and very specific.
One issue with kosher meat is that even when an animal is from a species which can be eaten, its meat may not necessarily be kosher. After animals are slaughtered, they must be inspected to confirm that they are free of disease or injury. If the animal was injured or sick, the meat is treif, and cannot be eaten, even if the meat would pass a food safety inspection. There is also some debate in the Jewish community about glatt kosher meat; in some Jewish communities, the lungs in particular must be free of defects so that the meat can be certified as glatt, which requires that the animal meet additional standards.
Kosher butchering itself, known as shechita, is also somewhat complex. It needs to be performed by a member of the Jewish faith who is trained to perform the procedure, is pious, and who respects the life of the animal being slaughtered. It must also be performed in a certain way, by slicing the throat while the animal is conscious, with the meat being handled so that it is drained completely of blood. A shochet or ritual slaughterer must learn a number of strict codes before performing ritual slaughter.
Certain types of meat may require special handling. For example, some cuts need to be subjected to porging, in which sinew, veins, and fat are removed. Rather than porging these cuts, some kosher slaughterhouses opt to sell the meat to the non-kosher market, which can make these cuts difficult to obtain when people need them.
The special handling, need to keep kosher meat separate from that which is non-kosher, and special training needed by people who work with kosher meat all add to the expense. For devout Jews who wish to observe dietary law, this expense is considered acceptance in exchange for the assurance that the meat has been handled and prepared properly. Kosher meat is not necessarily of better quality, so less faithful Jews and Gentiles may opt to purchase regular meat if it is available.
Well, I always buy Hebrew National hot dogs because they are kosher and I can count on the fact they don't have "byproducts" in them because they are certified kosher.
Yes, they are more expensive, but I'm willing to pay the extra if it means I'm not getting beef lips or beef ears in my hot dogs.
Many observant Jews are mostly vegetarian, probably because of the expensive kosher meat prices. They are more apt to eat dairy, fish and eggs for their protein, since there are not so many restrictions on these foods.
There's something to be said for requiring the butcher have respect for the animal's life, and to do the deed as humanely as possible. There's a lot to be said for that attitude, in fact.