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Genetic Contamination of Traditional Products

  • Choi, E. Kwan
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    Cross-pollination can be caused by birds, insects and wind. Genetically modified (GM) seeds are produced each year in a controlled environment to maintain their purity. However, pollen from the GM crop can be transferred to traditional crops. When the GM crop producers are in long-run equilibrium and buy seeds from a monopolistic seed producer, the resulting market equilibrium is identical to that when a seed monopolist produces the GM crop directly. When involuntary genetic contamination occurs, the monopolist eventually loses its advantage and stops its protection of GM seeds. A terminator gene can stop genetic contamination but imposes spillover costs on the traditional producers and reduces their outputs.

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    File URL: http://www.econ.iastate.edu/sites/default/files/publications/papers/p17369-2013-06-01.pdf
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    Paper provided by Iowa State University, Department of Economics in its series Staff General Research Papers with number 37369.

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    Date of creation: 31 May 2013
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    Publication status: Published in International Review of Economics and Finance, June 2013, vol. 27 no. 1, pp. 291-297
    Handle: RePEc:isu:genres:37369
    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
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    1. Sikdar, Shiva & Lapan, Harvey E., 2008. "Strategic Environmental Policy Under Free Trade with Transboundary Pollution," Staff General Research Papers 12931, Iowa State University, Department of Economics.
    2. Linda A. Toolsema, 2008. "Competition with Mandatory Labeling of Genetically Modified Products," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 164(3), pages 429-448, September.
    3. Choi, E. Kwan, 2010. "International Trade in Genetically Modified Products," Staff General Research Papers 31265, Iowa State University, Department of Economics.
    4. Belcher, Ken & Nolan, James & Phillips, Peter W.B., 2005. "Genetically modified crops and agricultural landscapes: spatial patterns of contamination," Ecological Economics, Elsevier, vol. 53(3), pages 387-401, May.
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