The Value of Verifiable Information in a Controversial Market: Evidence from Lab Auctions of Genetically Modified Food
Two interested parties dominate the current debate on genetically modified (GM) foods: environmental groups and agribusiness companies. For the average consumer to arrive at an informed decision on these new foods, they must rely on information from interested parties. Unfortunately, information from interested parties does not provide an accurate picture of the benefits and risks of new products. This paper examines the effects of information on consumers? demand for new food products, GM-foods, in an environment where information from one or more interested parties is provided. We design and conduct laboratory auction experiments using randomly chosen adult consumers from two large metropolitan areas who are grouped into twelve experimental units and subjected to six randomly assigned information treatments. We find that in this environment, verifiable information has a small but positive value to sample consumers, and the projected annual social value to all processed foods consumed is relatively large for this public good. Such a large potential value may make it worthwhile for the United States to establish a new third party institution that would produce and distribute verifiable information on GM food.
|Date of creation:||25 Feb 2002|
|Contact details of provider:|| Postal: Iowa State University, Dept. of Economics, 260 Heady Hall, Ames, IA 50011-1070|
Phone: +1 515.294.6741
Fax: +1 515.294.0221
Web page: http://www.econ.iastate.edu
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Jason F. Shogren & John A. Fox, 1996. "Consumer Preferences for Fresh Food Items with Multiple Quality Attributes: Evidence from an Experimental Auction of Pork Chops," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(4), pages 916-923.
When requesting a correction, please mention this item's handle: RePEc:isu:genres:10009. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Curtis Balmer)
If references are entirely missing, you can add them using this form.