Genetically Modified Foods: Consumer Issues and the Role of Information Asymmetry

Abstract

Consumer attitudes towards genetically modified foods (GMFs) differ widely, particularly between North America and Europe. Information asymmetry, incomplete information and uncertainty arise as a result of concerns over GMFs . This paper explores the evolution of consumer attitudes towards genetically modijed foods in Europe and in North America and discusses a number ofprivate market and public policy solutions to the problems of imperfect information and uncertainty. The paper concludes with suggestions for further research.Can. J. Agric. Econ. 47: 445-455 445

Preferences and willingness to pay for GM labeling policies

“…Labeling policies help to reduce the asymmetric information problem of genetically modified (GM) practices that currently exist between producers and consumers (Hobbs and Plunkett, 1999). Thus, producers know a priori what technology they use and whether their crops are GM or not, while consumers do not have this information.…”

If we label it, will they care? The effect of GM-ingredient labelling on consumer responses

“…It is probably true that the labelling will not achieve the real goals of activists who are totally opposed to GM foods, since, as long as there is any market for them, they will exist and the externalities of their production and use will affect all (Golan et al, 2001). Some argue that the health of North American consumers is better served through better use of nutritional information than GM-content information and that GM-labels will create problems of information overload (Hobbs & Plunkett, 1999).…”

The Identification and Classification of Genetically Modified Organisms: Implications for Trade

“…Examples of these types of externalities can be found in Butler and Reichhardt (1999), Flint and Chesson (1999), Gendel (1998), Gilbert (1999), Hobbs and Plunkett (1999), KappeJi and Auberson (1998), Persley and Siedow (1999), and Walsh (1999). The externality discussed here represents only actual negative-health impacts that lead to increased personal health costs for consumers, such as the loss of income and reduced quality of life.…”

“…For a further discussion of labeling and segregation issues see Caswell (1999), Herrman and Boland (1999), Hoef et al (1998), Hobbs and Plunkett (1999), Hurburgh (1994), Smyth and Phillips (1999), and Vandeburg et al (2000). The credence nature of the OMO attribute requires a signaling mechanism, such as segregation and labeling.…”