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Segregating genetically modified and nongenetically modified corn in a marketing channel

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  • Charles Moss
  • Troy Schmitz
  • A. Schmitz

Abstract

The adoption of GM corn in the United States depends on many factors including segregation costs, which have minor impacts on aggregate welfare. Because the demand for nonGM corn is small relative to its supply, no premium for nonGM corn can be generated in excess of the segregation costs. An outward shift in the supply of corn resulting from the adoption of GM varieties has a greater impact on aggregate welfare than do the segregation costs required to satisfy the GM-free demand. A 10% increase in the aggregate supply of GM corn increases aggregate welfare by more than US $250 million. However, nonadopters of GM corn lose while adopters can gain or lose depending on the nature of the aggregate demand curve for US corn.

Suggested Citation

  • Charles Moss & Troy Schmitz & A. Schmitz, 2008. "Segregating genetically modified and nongenetically modified corn in a marketing channel," Applied Economics, Taylor & Francis Journals, vol. 40(21), pages 2765-2774.
    • Handle: RePEc:taf:applec:v:40:y:2008:i:21:p:2765-2774
    DOI: 10.1080/00036840600970336
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    References listed on IDEAS

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    1. Duffy, Michael, 2001. "Who Benefits from Biotechnology?," Staff General Research Papers Archive 2084, Iowa State University, Department of Economics.
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    Cited by:

    1. Zhu, Manhong & Schmitz, Andrew & Schmtiz, Troy G., 2016. "Why Has not Genetically Modified Wheat Been Commercialized: A Game Theoretical Perspective," 2016 Annual Meeting, February 6-9, 2016, San Antonio, Texas 230796, Southern Agricultural Economics Association.

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