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Can foods produced with new plant engineering techniques succeed in the marketplace? A case study of apples

Author

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  • Stephan Marette

    (Université Paris-Saclay, INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

  • John Beghin

    (Yeutter Institute of International Trade and Finance)

  • Anne-Célia Disdier

    (PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

  • Eliza Mojduszka

    (USDA - United States Department of Agriculture)

Abstract

New Plant Engineering Techniques (NPETs) have path-breaking potential to improve foods by strengthening their production, increasing resistance to biotic and abiotic stresses, and by bettering their appearance and nutritional quality. Can NPETs-based foods succeed in the marketplace? Providing answers to this question, we first develop a simple economic model for R&D investment in food innovations based on NPETs and traditional hybridization methods, to identify which technology emerges under various parameter characterizations and associated economic welfare outcomes. The framework combines the cost of food innovation with consumers' willingness to pay (WTP) for the new food, highlighting the uncertain and costly nature of R&D processes as well as the role of consumer acceptance of technology, and the cost of ignorance, and regret, if consumers are not fully informed on the technology used to generate the new food. We then apply the framework to a case of NPETs-based new apples using recently elicited WTP of French and US consumers. Our simulation results suggest that NPETs may be socially beneficial under full information, and when the probability of success under NPETs is significantly higher than under traditional hybridization. Otherwise, the innovation based on traditional hybridization is socially optimal. A probable collapse of conventional apples raises the social desirability of new apples generated by NPETs and traditional hybridization.

Suggested Citation

  • Stephan Marette & John Beghin & Anne-Célia Disdier & Eliza Mojduszka, 2021. "Can foods produced with new plant engineering techniques succeed in the marketplace? A case study of apples," Working Papers halshs-03167477, HAL.
  • Handle: RePEc:hal:wpaper:halshs-03167477
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    References listed on IDEAS

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    1. Jutta Roosen & Stéphan Marette, 2011. "Making the "right" choice based on experiments: regulatory decisions for food and health," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 38(3), pages 361-381, August.
    2. Stephan Marette & Anne-Célia Disdier & John Beghin, 2020. "A Comparison of EU and US consumers' willingness to pay for gene-edited food: Evidence from apples," PSE Working Papers halshs-02872222, HAL.
    3. Rousu, Matthew C. & Marette, Stéphan & Thrasher, James F. & Lusk, Jayson L., 2014. "The economic value to smokers of graphic warning labels on cigarettes: Evidence from combining market and experimental auction data," Journal of Economic Behavior & Organization, Elsevier, vol. 108(C), pages 123-134.
    4. Matin Qaim, 2020. "Role of New Plant Breeding Technologies for Food Security and Sustainable Agricultural Development," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 42(2), pages 129-150, June.
    5. John C. Beghin & Christopher R. Gustafson, 2021. "Consumer Valuation of and Attitudes towards Novel Foods Produced with New Plant Engineering Techniques: A Review," Sustainability, MDPI, vol. 13(20), pages 1-17, October.
    6. Jayson L. Lusk & Stéphan Marette, 2010. "Welfare Effects of Food Labels and Bans with Alternative Willingness to Pay Measures," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 32(2), pages 319-337.
    7. Matthew Rousu & Wallace E. Huffman & Jason F. Shogren & Abebayehu Tegene, 2007. "Effects And Value Of Verifiable Information In A Controversial Market: Evidence From Lab Auctions Of Genetically Modified Food," Economic Inquiry, Western Economic Association International, vol. 45(3), pages 409-432, July.
    8. Stéphan Marette & Jutta Roosen & Sandrine Blanchemanche, 2008. "Taxes and subsidies to change eating habits when information is not enough: an application to fish consumption," Journal of Regulatory Economics, Springer, vol. 34(2), pages 119-143, October.
    9. Yokessa, Maïmouna & Marette, Stéphan, 2019. "A Review of Eco-labels and their Economic Impact," International Review of Environmental and Resource Economics, now publishers, vol. 13(1-2), pages 119-163, April.
    10. Mario F. Teisl & Nancy E. Bockstael & Alan Levy, 2001. "Measuring the Welfare Effects of Nutrition Information," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(1), pages 133-149.
    11. Foster, William & Just, Richard E., 1989. "Measuring welfare effects of product contamination with consumer uncertainty," Journal of Environmental Economics and Management, Elsevier, vol. 17(3), pages 266-283, November.
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    13. Beghin, John C. & Gustafson, Christopher R., 2021. "Consumer valuation of and attitudes towards novel foods produced with NPETs: A review," ISU General Staff Papers 202108250700001133, Iowa State University, Department of Economics.
    14. Violet Muringai & Xiaoli Fan & Ellen Goddard, 2020. "Canadian consumer acceptance of gene‐edited versus genetically modified potatoes: A choice experiment approach," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 68(1), pages 47-63, March.
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    17. Lusk, Jayson L. & Marette, Stephan, 2010. "Appendix to: Welfare Effects of Food Labels and Bans with Alternative Willingness to Pay Measures," Applied Economic Perspectives and Policy Appendices 55428, Agricultural and Applied Economics Association.
    18. Anna K. Edenbrandt & Christian Gamborg & Bo J. Thorsen, 2018. "Consumers’ Preferences for Bread: Transgenic, Cisgenic, Organic or Pesticide†free?," Journal of Agricultural Economics, Wiley Blackwell, vol. 69(1), pages 121-141, February.
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    1. Stephan Marette & Anne-Célia Disdier & Anastasia Bodnar & John Beghin, 2021. "New Plant Engineering Techniques, R&D Investment, and International Trade," PSE Working Papers halshs-03359622, HAL.

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    More about this item

    Keywords

    New plant engineering techniques (NPETs); Gene editing (GE); Consumer information; Willingness to pay; Food innovation; Industrial organization; Apple;
    All these keywords.

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