Better Dead Than GM-Fed? Information and the Effects of Consumers' Resistance to GM-Foods in High-Income Countries

This paper addressed the puzzling resistance of Presidents of southern African countries to food aid in 2002, given near certain starvation and long-term negative health effects of malnutrition of their constituents. First, I show that NGOs led by Greenpeace and Friends of the Earth are disseminating information claiming that GM foods are dangerous to human health and are “Frankenfoods.” Second, people in European Union countries, who are not in any danger of starvation, have strong preferences for non-GM foods, which they can easily afford. Over the long term, however, the tastes of EU consumers matter to southern African countries because some of these countries hope to export agricultural products in the future. GM-food aid, which most likely would contain GM-maize, is seen as a potential contaminant to native African maize varieties, and over the long term to be a threat to south African exports to the EU. Hence, understanding resistance to GM-food in developed countries is crucial to formulation of better food policies in Africa and to sustainable development.New and important results are reported from a statistical analysis of the market characteristics that push consumers in a high-income country to resist GM foods, with an emphasis on negative information from environmental groups and third-party, verifiable information, which could neutralize misinformation. For this study, a unique sample of adult consumers participated in laboratory (random nth price) auctions of three food products where labeling and information treatments were randomly assigned to experimental units. A key finding is that negative GM-information supplied by environmental groups pushes some high income consumers out of the market for GM products and increases the probability that all consumers are out of the market. However, verifiable information dampens the effectiveness of negative GM-product information. Hence, a vocal interested source can stymie technology adoption in both rich and poor countries and increase the probability of general malnutrition and micro-nutrient deficiencies and starvation and unsustainable development in poor countries because of the failure to accept food and adopt new GM technology.