Consumer benefits of labels and bans on genetically modified food - An empirical analysis using Choice Experiments

Fredrik Carlsson, Peter Frykblom and Carl-Johan Lagerkvist
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Peter Frykblom: Department of Economics, Appalachian State University, Postal: Boone, North Carolina 28608-2051

No 129, Working Papers in Economics from University of Gothenburg, Department of Economics

Abstract: Applying an experiment on the choice of consumer goods, we show that Swedish consumers do not regard genetically modified (GM) food as being equivalent to conventional food. A central argument by proponents of GM is that the end products are identical to those where GM has not been used. That respondents in our survey disagree with this argument is supported by two observations. First, a positive significant WTP is found for a mandatory labeling policy. This result confirms previous observations that GM food can be a credence good causing a market failure. Second, consumers are also willing to pay a significantly higher product price to ensure a total ban on the use of GM in animal fodder. Even if scientists and politicians argue that most of today’s GM food is indistinguishable from GM-free food,consumers disagree.´

Keywords: choice experiment; credence good; genetically modified; random parameters logit; public good (search for similar items in EconPapers)
JEL-codes: Q13 Q16 Q18 (search for similar items in EconPapers)
Pages: 16 pages
Date: 2004-03-12
New Economics Papers: this item is included in nep-dcm and nep-res
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Citations: View citations in EconPapers (11)

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Working Paper: Consumer benefits of labels and bans on genetically modified food - An empirical analysis using Choice Experiments (2004)
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