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GMO Testing Strategies and Implications for Trade: A Game Theoretic Approach

  • Konduru, Srinivasa
  • Kalaitzandonakes, Nicholas G.
  • Magnier, Alexandre
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    Since their commercial introduction in 1996, genetically modified (GM) crops have been quickly adopted world wide, but some GM crops/varieties have not received regulatory approval for use in some importing countries, leading to asynchronicity in regulatory approvals. In this context, the international agricultural trade relied on analytical GMO testing which is a statistical process, along with identity preserved systems to segregate GM and non-GM crops. This led to a situation where measurement uncertainty became an important issue as it can lead to potential holdups at the point of import. In this background, this paper examines the implications of measurement uncertainty associated with GMO testing on the behavior of importers and exporters in a game theoretic framework. The results indicate that relative size of identity preservation costs, testing and rejection costs, the premiums offered in the non- GM markets and measurement uncertainty all have direct impacts on the behavior of importers and exporters.

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    Paper provided by Agricultural and Applied Economics Association in its series 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin with number 49594.

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    Date of creation: 2009
    Date of revision:
    Handle: RePEc:ags:aaea09:49594
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    11. Giannakas, Konstantinos & Fulton, Murray, 2002. "Consumption effects of genetic modification: what if consumers are right?," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 27(2), August.
    12. Jayson L. Lusk & Brian C. Briggeman, 2009. "Food Values," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(1), pages 184-196.
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    14. McCluskey, Jill J., 2000. "A Game Theoretic Approach To Organic Foods: An Analysis Of Asymmetric Information And Policy," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 29(1), April.
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