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Labeling Regulations and Segregation of First- and Second-Generation GM Products: Innovation Incentives and Welfare Effects

In: Regulating Agricultural Biotechnology: Economics and Policy

Author

Listed:
  • GianCarlo Moschini

    (Iowa State University)

  • Harvey Lapan

    (Iowa State University)

Abstract

We review some of the most significant issues and results on the economic effects of genetically modified (GM) product innovation, with emphasis on the question of GM labeling and the need for costly segregation and identity preservation activities. The analysis is organized around an explicit model that can accommodate the features of both first-generation and second-generation GM products. The model accounts for the proprietary nature of GM innovations and for the critical role of consumer preferences vis-à-vis GM products, as well as for the impacts of segregation and identity preservation and the effects of a mandatory GM labeling regulation. We also investigate briefly a novel question in this setting, the choice of “research direction” when both cost-reducing and quality-enhancing GM innovations are feasible.

Suggested Citation

  • GianCarlo Moschini & Harvey Lapan, 2006. "Labeling Regulations and Segregation of First- and Second-Generation GM Products: Innovation Incentives and Welfare Effects," Natural Resource Management and Policy, in: Richard E. Just & Julian M. Alston & David Zilberman (ed.), Regulating Agricultural Biotechnology: Economics and Policy, chapter 0, pages 263-281, Springer.
    • Handle: RePEc:spr:nrmchp:978-0-387-36953-2_13
    DOI: 10.1007/978-0-387-36953-2_13
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    Cited by:

    1. GianCarlo Moschini, 2008. "Biotechnology and the development of food markets: retrospect and prospects," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 35(3), pages 331-355, September.
    2. Huffman, Wallace E., 2010. "Consumer Acceptance of Genetically Modified Foods: Traits, Labels and Diverse Information," Working Papers 93168, Iowa State University, Department of Economics.
    3. Zilberman, David & Graff, Gregory & Hochman, Gal & Kaplan, Scott, 2015. "The Political Economy of Biotechnology," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 64(04), December.
    4. Hajderllari, Eliona & Karantininis, Kostas, 2011. "Genetically modified foods in vertically differentiated and vertically oligopolistic markets," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114774, European Association of Agricultural Economists.

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