Planting Decisions and Uncertain Consumer Acceptance of Genetically Modified Crop Varieties

Alexander Saak () and David Hennessy

Staff General Research Papers Archive from Iowa State University, Department of Economics

Abstract: There exists much uncertainty about consumer attitudes toward genetically modified foods. If it happens that sufficient (insufficient) acres are planted under nonmodified seed to meet postharvest demand, then a price premium will not (will) emerge for the nonmodified varieties. A nonlinearity originates in the fact that a price premium may not be supported. This nonlinearity interacts with demand uncertainty to determine equilibrium plantings and the probability that postharvest varietal prices differ. Also, as planting approaches signals will be broadcast about the nature of postharvest demand. We show how the nonlinearity affects the types of signals that growers will prefer to receive.

Date: 2002-05-01
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Published in American Journal of Agricultural Economics, May 2002, vol. 84, pp. 308-319

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Related works:
Journal Article: Planting Decisions and Uncertain Consumer Acceptance of Genetically Modified Crop Varieties (2002)
Working Paper: PLANTING DECISIONS AND UNCERTAIN CONSUMER ACCEPTANCE OF GENETICALLY MODIFIED CROP VARIETIES (2001)
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Persistent link: https://EconPapers.repec.org/RePEc:isu:genres:5026

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