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WHY ARE US AND EU POLICIES TOWARD GMOs SO DIFFERENT?

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Author Info

  • Jackson, Lee Ann
  • Anderson, Kym

Abstract

The development of genetically modified (GM) agricultural products requires new policies to manage potential food safety and environmental risks. The policy positions taken to date on GM foods by the United States and the European Union are very different. The US has few restrictions on production and trade in GM food products and no costly labelling requirements, whereas the EU has close to a ban on the production and importation of GM foods. This paper seeks to explain (a) why both the US and EU policies are extreme in the light of the uncertainty about the risks associated with GM foods, (b) what their consequences are for income distribution and trade in farm products, and (c) what it means for the GM policies and economic welfare of people in other (particularly developing) countries. In this paper we use the GTAP global economy wide model to estimate the extent of the trade, national welfare and income distributional effects of the actual policy choices of the US and the EU as compared with what they would be if GM products were adopted with less-distortionary GM policies. The distributional effects are used to also shed light on why the US and EU have adopted such different sub-optimal GM policies.

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File URL: http://purl.umn.edu/57898
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Bibliographic Info

Paper provided by Australian Agricultural and Resource Economics Society in its series 2003 Conference (47th), February 12-14, 2003, Fremantle, Australia with number 57898.

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Date of creation: Feb 2003
Date of revision:
Handle: RePEc:ags:aare03:57898

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Related research

Keywords: genetically modified crops; trade barriers; productivity growth; political economy of agricultural protection; Agricultural and Food Policy; Crop Production/Industries; International Relations/Trade;

References

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  1. Baldwin, Robert E, 1989. "The Political Economy of Trade Policy," Journal of Economic Perspectives, American Economic Association, vol. 3(4), pages 119-35, Fall.
  2. Grossman, Gene M & Helpman, Elhanan, 1994. "Protection for Sale," American Economic Review, American Economic Association, vol. 84(4), pages 833-50, September.
  3. Stone, Susan F. & Matysek, Anna & Dolling, Andrew, 2002. "Modelling Possible Impacts of GM Crops on Australian Trade," Staff Research Papers 31913, Productivity Commission.
  4. Nielsen, Chantal Pohl & Thierfelder, Karen & Robinson, Sherman, 2001. "Genetically modified foods, trade, and developing countries," TMD discussion papers 77, International Food Policy Research Institute (IFPRI).
  5. van Tongeren, Frank W. & van Meijl, Hans, 2003. "International Diffusion Of Gains From Biotechnology And The European Union'S Common Agricultural Policy," 2003 Annual Meeting, August 16-22, 2003, Durban, South Africa 25835, International Association of Agricultural Economists.
  6. Chantal Nielsen & Kym Anderson, 2001. "Global market effects of alternative European responses to genetically modified organisms," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 137(2), pages 320-346, June.
  7. Kym Anderson & Shunli Yao, 2003. "China, Gmos And World Trade In Agricultural And Textile Products," Pacific Economic Review, Wiley Blackwell, vol. 8(2), pages 157-169, 06.
  8. Anderson, Kym, 1993. "Lobbying Incentives and the Pattern of Protection in Rich and Poor Countries," CEPR Discussion Papers 789, C.E.P.R. Discussion Papers.
  9. Baldwin, Richard, 2000. "Regulatory Protectionism, Developing Nations and a Two-Tier World Trade System," CEPR Discussion Papers 2574, C.E.P.R. Discussion Papers.
  10. Mishra, Ashok K. & El-Osta, Hisham S. & Morehart, Mitchell J. & Johnson, James D. & Hopkins, Jeffrey W., 2002. "Income, Wealth, And The Economic Well-Being Of Farm Households," Agricultural Economics Reports 33967, United States Department of Agriculture, Economic Research Service.
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Citations

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Cited by:
  1. Anderson, Kym & Jackson, Lee Ann, 2004. "Implications of genetically modified food technology policies for Sub-Saharan Africa," Policy Research Working Paper Series 3411, The World Bank.
  2. Kym Anderson & Lee Ann Jacskon & Chantal Pohl Nielsen, 2004. "Genetically Modified Rice Adoption: Implications for Welfare and Poverty Alleviation," Centre for International Economic Studies Working Papers 2004-13, University of Adelaide, Centre for International Economic Studies.
  3. Gruere, Guillaume P. & Carter, Colin A. & Farzin, Y. Hossein, 2004. "Explaining International Differences In Genetically Modified Food Labeling Regulations," 2004 Annual meeting, August 1-4, Denver, CO 20341, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  4. Anderson, Kym & Pohl Nielsen, Chantal, 2004. "Golden Rice and the Looming GMO Trade Debate: Implications for the Poor," CEPR Discussion Papers 4195, C.E.P.R. Discussion Papers.
  5. Marchant, Mary A. & Song, Baohui, 2005. "Assessment of Biotechnology Policies and International Trade in Key Markets for U.S. Agriculture," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 37(02), August.

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