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Differentiating the consumer benefits from labeling of GM food products
Author(s) -
Scatasta Sara,
Wesseler Justus,
Hobbs Jill
Publication year - 2007
Publication title -
agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.29
H-Index - 82
eISSN - 1574-0862
pISSN - 0169-5150
DOI - 10.1111/j.1574-0862.2007.00269.x
Subject(s) - willingness to pay , economics , quality (philosophy) , yield (engineering) , food products , microeconomics , marketing , business , food science , chemistry , philosophy , materials science , epistemology , metallurgy
Although recurrent evidence is found that consumers have different willingness to pay for GM and non‐GM products, there is disagreement in the scientific community about the size of consumer benefits from GM labeling. In this article we use a theoretical model based on a standard constant elasticity of substitution (CES) to explain the importance of the quality effect. It is shown that failing to consider the quality effect may yield an overestimation of benefits from GM labeling, voluntary or mandatory.