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International trade in genetically modified products

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  • Choi, E. Kwan

Abstract

This paper investigates competition between two markets that sell close substitutes: a traditional product and a genetically modified (GM) product. Tightening an import quota on the GM product raises the prices of both goods and hurts consumers. Two scenarios are considered under free trade: Cournot-Nash equilibrium and Stackelberg equilibrium. A Stackelberg type monopolist produces more, and the competitive traditional firms produce less, than in Cournot-Nash equilibrium. In the long run, an import ban on the GM product does not help competitive producers of the genetically modified organism (GMO)-free products but benefits only the landowners in Europe.

Suggested Citation

  • Choi, E. Kwan, 2010. "International trade in genetically modified products," International Review of Economics & Finance, Elsevier, vol. 19(3), pages 383-391, June.
    • Handle: RePEc:eee:reveco:v:19:y:2010:i:3:p:383-391
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    References listed on IDEAS

    as
    1. Choi, E. Kwan, 2007. "North-South trade and income inequality," International Review of Economics & Finance, Elsevier, vol. 16(3), pages 347-356.
    2. Higgins, Richard S & Rubin, Paul H, 1986. "Counterfeit Goods," Journal of Law and Economics, University of Chicago Press, vol. 29(2), pages 211-230, October.
    3. Guillaume P. Gruère & Colin A. Carter & Y. Hossein Farzin, 2008. "What labelling policy for consumer choice? The case of genetically modified food in Canada and Europe," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 41(4), pages 1472-1497, November.
    4. Long, Ngo Van, 2005. "Outsourcing and technology spillovers," International Review of Economics & Finance, Elsevier, vol. 14(3), pages 297-304.
    5. Choi, E. Kwan, 2008. "Factor growth and equalized factor prices," International Review of Economics & Finance, Elsevier, vol. 17(4), pages 517-528, October.
    6. Linda A. Toolsema, 2008. "Competition with Mandatory Labeling of Genetically Modified Products," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 164(3), pages 429-448, September.
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    Citations

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    Cited by:

    1. E. Kwan Choi, 2011. "Genetic Contamination of Traditional Products," CESifo Working Paper Series 3624, CESifo.
    2. Choi, E. Kwan, 2013. "Genetic contamination of traditional products," International Review of Economics & Finance, Elsevier, vol. 27(C), pages 291-297.
    3. Dinopoulos, Elias & Livanis, Grigorios & West, Carol, 2010. "Country of Origin Labeling (C.O.O.L.): How cool is it?," International Review of Economics & Finance, Elsevier, vol. 19(4), pages 575-589, October.
    4. Benchekroun, H. & Benchekroun, S., 2015. "Harvests' lifespan and North–South market share rivalry," International Review of Economics & Finance, Elsevier, vol. 37(C), pages 114-124.
    5. E. Kwan Choi, 2011. "Genetic Contamination of Traditional Products," DEGIT Conference Papers c016_002, DEGIT, Dynamics, Economic Growth, and International Trade.
    6. Winston W. Chang, 2017. "World Trade and the Environment: Issues and Policies," Pacific Economic Review, Wiley Blackwell, vol. 22(3), pages 435-479, August.

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    More about this item

    Keywords

    Genetically modified products Import ban Landowners;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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