Scandinavian Working Papers in Economics
Working Papers in Economics,
University of Gothenburg, Department of Economics
No 129: Consumer benefits of labels and bans on genetically modified food - An empirical analysis using Choice Experiments
Fredrik Carlsson (), Peter Frykblom and Carl-Johan Lagerkvist ()
Additional contact information
Fredrik Carlsson: Department of Economics, School of Economics and Commercial Law, Göteborg University, Postal: Box 640, SE 40530 GÖTEBORG
Peter Frykblom: Department of Economics, Appalachian State University, Postal: Boone, North Carolina 28608-2051
Carl-Johan Lagerkvist: Swedish University of Agricultural Sciences, Postal: Box 7013, 750 07 UPPSALA
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
16 pages, March 12, 2004
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