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Who pays the costs of non-GMO segregation and identity preservation?

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  • Desquilbet, Marion
  • Bullock, David S.

Abstract

This paper proposes an analytical framework to examine the market and welfare impacts of GMOs, when some consumers refuse genetically modified organisms (GMOs) and when two supply channels are segregated (one for goods that containing GMOs and one for non-genetically-modified identity-preserved goods). Our analytical framework begins at the level of individual farmers, handlers and consumers, to build up market supply and demand functions. This allows us to circumvent the difficulties of conducting supply and demand analysis in the different horizontally and vertically related markets concerned by GMOs and market segregation. We represent explicitly the costs of non-GMO segregation and identity preservation (IP) for both producers of non-GM IP goods and producers of non-IP goods, and how these costs vary depending on the relative sizes of the two production channels. We then illustrate our model by a simulation of potential adoption of GM rapeseed with non-GMO market segregation in the European Union (EU). We analyze how the costs of IP are distributed among heterogenous producers, handlers and consumers in this simulation.

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Bibliographic Info

Paper provided by European Association of Agricultural Economists in its series 2002 International Congress, August 28-31, 2002, Zaragoza, Spain with number 24973.

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Date of creation: 2002
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Handle: RePEc:ags:eaae02:24973

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Related research

Keywords: genetically modified organisms; consumers'; non genetically modified product; segregation; innovation; multi-market analysis; Consumer/Household Economics;

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References

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  1. William D. McBride & Nora Books, 2000. "Survey evidence on producer use and costs of genetically modified seed," Agribusiness, John Wiley & Sons, Ltd., vol. 16(1), pages 6-20.
  2. Giannakas, Konstantinos & Fulton, Murray, 2002. "Consumption effects of genetic modification: what if consumers are right?," Agricultural Economics, Blackwell, vol. 27(2), pages 97-109, August.
  3. Desquilbet, Marion & Lemarie, Stephane & Levert, Fabrice, 2002. "Potential Adoption of Genetically Modified Rapeseed in France, Effects on Revenues of Farmers and Upstream Companies: an ex ante evaluation," 2002 International Congress, August 28-31, 2002, Zaragoza, Spain 24975, European Association of Agricultural Economists.
  4. Mayer, Holly & Furtan, W. H., 1999. "Economics of transgenic herbicide-tolerant canola: The case of western Canada," Food Policy, Elsevier, vol. 24(4), pages 431-442, August.
  5. Bullock, David S. & Desquilbet, Marion & Nitsi, Elisavet I., 2000. "The Economics Of Non-Gmo Segregation And Identity Preservation," 2000 Annual meeting, July 30-August 2, Tampa, FL 21845, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
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Cited by:
  1. Skevas, Theodoros & Fevereiro, Pedro & Wesseler, Justus, 2010. "Coexistence regulations and agriculture production: A case study of five Bt maize producers in Portugal," Ecological Economics, Elsevier, vol. 69(12), pages 2402-2408, October.
  2. Andrei Sobolevsky & GianCarlo Moschini & Harvey E. Lapan, 2002. "Genetically Modified Crop Innovations and Product Differentiation: Trade and Welfare Effects in the Soybean Complex," Center for Agricultural and Rural Development (CARD) Publications 02-wp319, Center for Agricultural and Rural Development (CARD) at Iowa State University.
  3. Desquilbet, Marion & Poret, Sylvaine, 2012. "How do GM / non GM coexistence regulations affect markets and welfare?," TSE Working Papers 12-350, Toulouse School of Economics (TSE).
  4. Nielsen, Chantal Pohl & Robinson, Sherman & Thierfelder, Karen, 2002. "Trade in genetically modified food," TMD discussion papers 106, International Food Policy Research Institute (IFPRI).

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