Signaling impacts of GMO labeling on fruit and vegetable demand.

D Adeline Yeh,Harry M Kaiser,Miguel I Gómez,Zhifeng Gao

doi:10.1371/journal.pone.0223910

Abstract

Food labels may have both informational and signaling influences on consumer demand. We conduct a choice experiment with over 1,300 subjects to examine the signaling effect of the food product labels on consumer demand for other competing products in the market. Specifically, we focus on the genetically modified (GM) text labeling for fresh produce (strawberries, apples, and potatoes) in the United States. Contrary to some previous studies, our results indicate that the absence-claim label (Not-GM) does not have a negative impact on the demand for related conventional products. Instead, we find that consumer demand for unlabeled products is significantly enhanced with the introduction of presence-claimed GM labels. Our results contribute to the ongoing discussion of the enactment of mandatory labeling for GM foods by the federal U.S. government. Our results suggest that, in the case of direct text disclosure labels, consumers may no longer differentiate between unlabeled products and Not-GM-labeled products after the mandatory GM labeling law is in effect.

Highlights

The agricultural and food sector has experienced astonishing technological progress over the past century, and consumers have been one of the main beneficiaries of this with an abundance of food supply at steadily decreasing real prices
In model 1, the initial demand for unlabeled products is estimated from Treatment 3–4; the signaling impact induced by genetically modified (GM) label is estimated from Treatment 1; and the signaling impact induced by Not-GM label is estimated from Treatment 6
The results indicate that the absence-claim label (NotGM) does not decrease the demand for either the unlabeled conventional products or the GMlabeled products, at least in fresh produce

Summary

Introduction

The agricultural and food sector has experienced astonishing technological progress over the past century, and consumers have been one of the main beneficiaries of this with an abundance of food supply at steadily decreasing real prices. Consumers have become increasingly concerned about how food is produced, processed and distributed. Production processes such as the use of genetically modified (GM) organisms (GMOs) have many critics and have prompted some consumer groups to advocate and successfully pass legislation for mandatory labels on their use in food products [1,2]. Some researchers have proposed that food labels may have an informational role and a signaling role, which can cast other products in a negative light. Consumer aversion towards GM food has been the impetus for mandatory GM labeling proposals and laws at the state and federal levels. While a recent study suggests that WTP are different in terms of which type of disclosure is displayed [15], NBFDS allows food marketers several

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