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Trade, Standards, and the Political Economy of Genetically Modified Food

  • Kym Anderson

    ()

    (World Bank)

  • Richard Damania

    (School of Economics, University of Adelaide)

  • Lee Ann Jacskon

    (WTO Secretariat, Geneva)

A common-agency lobbying model is developed to help understand why North America and the European Union have adopted such different policies towards genetically modified food. Our results show that when firms (in this case farmers) lobby policy makers to influence standards and consumers and environmentalists care about the choice of standard, it is possible that increased competition from abroad can lead to strategic incentives to raise standards, not just lower them as shown in earlier models. This theoretical proposition is supported by numerical results from a global general equilibrium model of GM adoption in America without and with an EU moratorium.

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Paper provided by University of Adelaide, Centre for International Economic Studies in its series Centre for International Economic Studies Working Papers with number 2004-10.

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Length: 35 pages
Date of creation: Nov 2004
Date of revision:
Handle: RePEc:adl:cieswp:2004-10
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  1. Meijl, Hans van & Tongeren, Frank van, 2004. "International diffusion of gains from biotechnology and the European Union's Common Agricultural Policy," Agricultural Economics, Blackwell, vol. 31(2-3), pages 307-316, December.
  2. Feder, Gershon & Just, Richard E & Zilberman, David, 1985. "Adoption of Agricultural Innovations in Developing Countries: A Survey," Economic Development and Cultural Change, University of Chicago Press, vol. 33(2), pages 255-98, January.
  3. Grossman, G.M. & Helpman, E., 1992. "Trade Wars and Trade Talks," Papers 163, Princeton, Woodrow Wilson School - Public and International Affairs.
  4. Anderson, Kym & Jackson, Lee Ann, 2004. "Standards, Trade And Protection: The Case Of Gmos," 2004 Annual meeting, August 1-4, Denver, CO 20282, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  5. Fernandez-Cornejo, Jorge & McBride, William D., 2000. "Genetically Engineered Crops For Pest Management In U.S. Agriculture," Agricultural Economics Reports 33931, United States Department of Agriculture, Economic Research Service.
  6. Boom, Anette, 1995. "Asymmetric International Minimum Quality Standards and Vertical Differentiation," Journal of Industrial Economics, Wiley Blackwell, vol. 43(1), pages 101-19, March.
  7. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June.
  8. Grossman, G.M. & Helpman, E., 1992. "Protection for Sale," Papers 21-92, Tel Aviv.
  9. Flam, Harry & Helpman, Elhanan, 1987. "Vertical Product Differentiation and North-South Trade," American Economic Review, American Economic Association, vol. 77(5), pages 810-22, December.
  10. Riordan, Michael H, 1986. "Monopolistic Competition with Experience Goods," The Quarterly Journal of Economics, MIT Press, vol. 101(2), pages 265-79, May.
  11. Murray Fulton & Konstantinos Giannakas, 2004. "Inserting GM Products into the Food Chain: The Market and Welfare Effects of Different Labeling and Regulatory Regimes," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 86(1), pages 42-60.
  12. Harvey E. Lapan & GianCarlo Moschini, 2002. "Innovation and Trade with Endogenous Market Failure: The Case of Genetically Modified Products," Center for Agricultural and Rural Development (CARD) Publications 02-wp302, Center for Agricultural and Rural Development (CARD) at Iowa State University.
  13. Fernandez-Cornejo, Jorge & McBride, William D., 2002. "Adoption Of Bioengineered Crops," Agricultural Economics Reports 33957, United States Department of Agriculture, Economic Research Service.
  14. Ronald Fischer & Pablo Serra, 1998. "Standards and Protection," Documentos de Trabajo 45, Centro de Economía Aplicada, Universidad de Chile.
  15. Bernheim, B Douglas & Whinston, Michael D, 1986. "Menu Auctions, Resource Allocation, and Economic Influence," The Quarterly Journal of Economics, MIT Press, vol. 101(1), pages 1-31, February.
  16. Marra, Michele C. & Pardey, Philip G. & Alston, Julian M., 2002. "The payoffs to agricultural biotechnology: an assessment of the evidence," EPTD discussion papers 87, International Food Policy Research Institute (IFPRI).
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