IDEAS home Printed from https://ideas.repec.org/p/cpr/ceprdp/4526.html
   My bibliography  Save this paper

Trade Standards and the Political Economy of Genetically Modified Food

Author

Listed:
  • Anderson, Kym
  • Damania, Richard
  • Jackson, Lee Ann

Abstract

A common-agency lobbying model is developed to help understand why North America and the European Union have adopted such different policies towards genetically modified food. Our results show that when firms (in this case farmers) lobby policy-makers to influence standards and consumers and environmentalists care about the choice of standard, it is possible that increased competition from abroad can lead to strategic incentives to raise standards, not just lower them as shown in earlier models. This theoretical proposition is supported by numerical results from a global general equilibrium model of GM adoption in America without and with an EU moratorium.

Suggested Citation

  • Anderson, Kym & Damania, Richard & Jackson, Lee Ann, 2004. "Trade Standards and the Political Economy of Genetically Modified Food," CEPR Discussion Papers 4526, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:4526
    as

    Download full text from publisher

    File URL: https://cepr.org/publications/DP4526
    Download Restriction: CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Nancy E. Bockstael, 1984. "The Welfare Implications of Minimum Quality Standards," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 66(4), pages 466-471.
    2. Grossman, Gene M & Helpman, Elhanan, 1995. "Trade Wars and Trade Talks," Journal of Political Economy, University of Chicago Press, vol. 103(4), pages 675-708, August.
    3. Murray Fulton & Konstantinos Giannakas, 2004. "Inserting GM Products into the Food Chain: The Market and Welfare Effects of Different Labeling and Regulatory Regimes," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 86(1), pages 42-60.
    4. Anderson, Kym & Jackson, Lee Ann, 2004. "Standards, Trade And Protection: The Case Of Gmos," 2004 Annual meeting, August 1-4, Denver, CO 20282, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Harvey E. Lapan & Giancarlo Moschini, 2004. "Innovation and Trade with Endogenous Market Failure: The Case of Genetically Modified Products," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 86(3), pages 634-648.
    6. B. Douglas Bernheim & Michael D. Whinston, 1986. "Menu Auctions, Resource Allocation, and Economic Influence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 101(1), pages 1-31.
    7. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June.
    8. Grossman, Gene M & Helpman, Elhanan, 1994. "Protection for Sale," American Economic Review, American Economic Association, vol. 84(4), pages 833-850, September.
    9. Meijl, Hans van & Tongeren, Frank van, 2004. "International diffusion of gains from biotechnology and the European Union's Common Agricultural Policy," Agricultural Economics, Blackwell, vol. 31(2-3), pages 307-316, December.
    10. Boom, Anette, 1995. "Asymmetric International Minimum Quality Standards and Vertical Differentiation," Journal of Industrial Economics, Wiley Blackwell, vol. 43(1), pages 101-119, March.
    11. Feder, Gershon & Just, Richard E & Zilberman, David, 1985. "Adoption of Agricultural Innovations in Developing Countries: A Survey," Economic Development and Cultural Change, University of Chicago Press, vol. 33(2), pages 255-298, January.
    12. Fernandez-Cornejo, Jorge & McBride, William D., 2000. "Genetically Engineered Crops For Pest Management In U.S. Agriculture," Agricultural Economic Reports 33931, United States Department of Agriculture, Economic Research Service.
    13. Fischer, Ronald & Serra, Pablo, 2000. "Standards and protection," Journal of International Economics, Elsevier, vol. 52(2), pages 377-400, December.
    14. Brian R. Copeland & M. Scott Taylor, 1995. "Trade and the Environment: A Partial Synthesis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 77(3), pages 765-771.
    15. Marra, Michele C. & Pardey, Philip G. & Alston, Julian M., 2002. "The payoffs to agricultural biotechnology: an assessment of the evidence," EPTD discussion papers 87, International Food Policy Research Institute (IFPRI).
    16. Maury Bredahl & Andrew Schmitz & Jimmye S. Hillman, 1987. "Rent Seeking in International Trade: The Great Tomato War," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 69(1), pages 1-10.
    17. Flam, Harry & Helpman, Elhanan, 1987. "Vertical Product Differentiation and North-South Trade," American Economic Review, American Economic Association, vol. 77(5), pages 810-822, December.
    18. Fernandez-Cornejo, Jorge & McBride, William D., 2002. "Adoption Of Bioengineered Crops," Agricultural Economic Reports 33957, United States Department of Agriculture, Economic Research Service.
    19. Michael H. Riordan, 1986. "Monopolistic Competition with Experience Goods," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 101(2), pages 265-279.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:lic:licosd:24609 is not listed on IDEAS
    2. Masoud Ali Khalid & Narmen M. Ghafor, 2019. "The Impact of NTMs on Trade: Evidence from Developing Countries," International Journal of Finance & Banking Studies, Center for the Strategic Studies in Business and Finance, vol. 8(1), pages 37-47, January.
    3. Johan F.M. Swinnen & Thijs Vandemoortele, 2008. "The Political Economy of Nutrition and Health Standards in Food Markets," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 30(3), pages 460-468.
    4. repec:lic:licosd:38617 is not listed on IDEAS
    5. Kareem, Fatima Olanike & Martinez-Zarzoso, Inmaculada & Brümmer, Bernhard, 2016. "Protecting Health or Protecting Imports? Evidence from EU Non-Tariff Barriers," GlobalFood Discussion Papers 241267, Georg-August-Universitaet Goettingen, GlobalFood, Department of Agricultural Economics and Rural Development.
    6. Kareem, Fatima Olanike & Martínez-Zarzoso, Inmaculada & Brümmer, Bernhard, 2018. "Protecting health or protecting imports? Evidence from EU non-tariff measures," International Review of Economics & Finance, Elsevier, vol. 53(C), pages 185-202.
    7. Swinnen Johan & Vandeplas Anneleen, 2012. "Rich Consumers and Poor Producers: Quality and Rent Distribution in Global Value Chains," Journal of Globalization and Development, De Gruyter, vol. 2(2), pages 1-30, January.
    8. Meloni, Giulia & Swinnen, Johan, 2017. "Standards, Tariffs And Trade: The Rise And Fall Of The Raisin Trade Between Greece And France In The Late 19th Century And The Definition Of Wine," Working Papers 253853, American Association of Wine Economists.
    9. Meloni, Giulia & Swinnen, Johan, 2018. "Trade and terroir. The political economy of the world’s first geographical indications," Food Policy, Elsevier, vol. 81(C), pages 1-20.
    10. Tao Xiang & Jikun Huang & d’Artis Kancs & Scott Rozelle & Jo Swinnen, 2012. "Food Standards and Welfare: General Equilibrium Effects," Journal of Agricultural Economics, Wiley Blackwell, vol. 63(2), pages 223-244, June.
    11. Annalisa Zezza & Federica Demaria & Maria Rosaria Pupo d'Andrea & Jo Swinnen & Giulia Meloni & Senne Vandevelde & Alessandro Olper & Daniele Curzi & Valentina Raimondi & Sophie Drogue, 2018. "Research for AGRI Committee - Agricultural trade: assessing reciprocity of standards," Working Papers hal-02787948, HAL.
    12. Lili Yan ING & Olivier CADOT, 2017. "Remaking Ad valorem equivalents of non-tariff measures in ASEAN," Working Papers DP-2017-09, Economic Research Institute for ASEAN and East Asia (ERIA).
    13. repec:lic:licosd:23609 is not listed on IDEAS
    14. Ana Santos & Jose Caetano, 2008. "EU regulation concerning genetically modified products: an issue of food security or a measure of disguised protectionism?," CEFAGE-UE Working Papers 2008_10, University of Evora, CEFAGE-UE (Portugal).
    15. Swinnen, Johan F.M. & Rozelle, Scott & Xiang, Tao & Vandemoortele, Thijs, 2009. "A Theory of Standards-Driven Rural Development," 2009 Conference, August 16-22, 2009, Beijing, China 51475, International Association of Agricultural Economists.
    16. Olivier CADOT & Lili Yan ING, 2017. "Ad-valorem equivalents of NTMs in ASEAN," Working Papers P203, FERDI.
    17. Beverelli, Cosimo & Boffa, Mauro & Keck, Alexander, 2014. "Trade policy substitution: Theory and evidence from Specific Trade Concerns," WTO Staff Working Papers ERSD-2014-18, World Trade Organization (WTO), Economic Research and Statistics Division.
    18. repec:lic:licosd:32012 is not listed on IDEAS
    19. repec:lic:licosd:19908 is not listed on IDEAS
    20. repec:lic:licosd:26310 is not listed on IDEAS
    21. Vigani, Mauro & Olper, Alessandro, 2013. "GMO standards, endogenous policy and the market for information," Food Policy, Elsevier, vol. 43(C), pages 32-43.
    22. repec:lic:licosd:30612 is not listed on IDEAS
    23. repec:lic:licosd:27611 is not listed on IDEAS

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:lic:licosd:23609 is not listed on IDEAS
    2. Olper, Alessandro, 2017. "The political economy of trade-related regulatory policy: environment and global value chain," Bio-based and Applied Economics Journal, Italian Association of Agricultural and Applied Economics (AIEAA), vol. 5(3), February.
    3. Johan F.M. Swinnen & Thijs Vandemoortele, 2008. "The Political Economy of Nutrition and Health Standards in Food Markets," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 30(3), pages 460-468.
    4. Vigani, Mauro & Olper, Alessandro, 2013. "GMO standards, endogenous policy and the market for information," Food Policy, Elsevier, vol. 43(C), pages 32-43.
    5. repec:lic:licosd:30612 is not listed on IDEAS
    6. Vigani, Mauro & Raimondi, Valentina & Olper, Alessandro, 2010. "GMO Regulations, International Trade and the Imperialism of Standards," 14th ICABR Conference, June 16-18, 2010, Ravello, Italy 188116, International Consortium on Applied Bioeconomy Research (ICABR).
    7. Annicchiarico, Barbara & Marvasi, Enrico, 2019. "Protection for sale under monopolistic competition: Beyond the CES," European Journal of Political Economy, Elsevier, vol. 60(C).
    8. Fischer, Ronald & Serra, Pablo, 2000. "Standards and protection," Journal of International Economics, Elsevier, vol. 52(2), pages 377-400, December.
    9. Enrico Marvasi, 2013. "Protection for Sale, Monopolistic Competition and Variable Markups," Working Papers - Economics wp2013_11.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa.
    10. Chang, Ching-Cheng & Hsu, Shih-Hsun & Wu, Chia-Hsuan, 2004. "An Economy-Wide Analysis Of Gm Food Labeling Policies In Taiwan," 2004 Annual meeting, August 1-4, Denver, CO 19929, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    11. Essaji Azim, 2010. "Trade Liberalization, Standards and Protection," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(1), pages 1-21, July.
    12. Pravin Krishna & Devashish Mitra, 2016. "Reciprocated unilateralism in trade policy," World Scientific Book Chapters, in: The Political Economy of Trade Policy Theory, Evidence and Applications, chapter 3, pages 37-63, World Scientific Publishing Co. Pte. Ltd..
    13. Grossman, Gene M & Helpman, Elhanan, 1995. "The Politics of Free-Trade Agreements," American Economic Review, American Economic Association, vol. 85(4), pages 667-690, September.
    14. Richard E. Baldwin & Frédéric Robert-Nicoud, 2007. "Entry and Asymmetric Lobbying: Why Governments Pick Losers," Journal of the European Economic Association, MIT Press, vol. 5(5), pages 1064-1093, September.
    15. Kato, Hayato, 2015. "Lobbying and Tax Competition in an Agglomeration Economy: A Reverse Home Market Effect," CCES Discussion Paper Series 56, Center for Research on Contemporary Economic Systems, Graduate School of Economics, Hitotsubashi University.
    16. Didier Laussel & Michel Le Breton, 2005. ""Favors" for Sale: Strategic Analysis of a Simple Menu Auction with Adverse Selection," Annals of Economics and Finance, Society for AEF, vol. 6(1), pages 53-73, May.
    17. Koichi Hamada & Shyam Sunder, 2005. "Information Asymmetry and the Problem of Transfers in Trade Negotiations and International Agencies," Working Papers 910, Economic Growth Center, Yale University.
    18. Giovanni Facchini, 2004. "The political economy of international trade and factor mobility," Journal of Economic Surveys, Wiley Blackwell, vol. 18(1), pages 1-32, February.
    19. Pravin Krishna & Devashish Mitra, 2003. "Reciprocated Unilateralism in Trade Policy: An Interest-Group Approach," NBER Working Papers 9631, National Bureau of Economic Research, Inc.
    20. Toke S. Aidt & Uk Hwang, 2014. "To Ban or Not to Ban: Foreign Lobbying and Cross‐National Externalities," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 47(1), pages 272-297, February.
    21. Conconi, Paola, 2003. "Green lobbies and transboundary pollution in large open economies," Journal of International Economics, Elsevier, vol. 59(2), pages 399-422, March.
    22. Koichi Hamada & Shyam Sunder, 2005. "Information Asymmetry and the Problem of Transfers in Trade Negotiations and International Agencies," Working Papers 910, Economic Growth Center, Yale University.

    More about this item

    Keywords

    Gmos; Political economy; Regulation of standards; Trade policy;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cpr:ceprdp:4526. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://www.cepr.org .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.