Environment and Development Economics


SPECIAL ISSUE: AGROINDUSTRIALIZATION, INTERNATIONAL DEVELOPMENT AND THE ENVIRONMENTGUEST EDITORS: CHRISTOPHER B. BARRETT, EDWARD B. BARBIER AND THOMAS REARDON

Transgenic crops and the environment: missing markets and public roles a


Sandra S. Batie a1 and David E. Ervin a2
a1 Elton R. Smith Professor in Food and Agricultural Policy, Department of Agricultural Economics, Michigan State University, East Lansing, Michigan 48824
a2 Senior Policy Analyst, Henry A. Wallace Institute, and Research Professor, Environmental Science, Portland University, Portland, Oregon 97207

Abstract

The rapidity of change has left scant opportunity for investigation of the consequences of adoption of transgenic crops on long-term ecosystem or economic system functioning. Economic theory suggests that, if the “Biotechnology Revolution” is left to market forces alone, there will be neglected public goods. Theory and limited empirical evidence suggests that there are significant incentives for private firms to discount and neglect certain environmental impacts and to develop products that meet mainly the needs of those able and willing to pay. Negative distributional impacts on rural societies and economies will not normally enter the private calculus nor will the long-term problems of insect and plant resistance. Thus, there is a strong case for enhanced public roles with respect to the use of transgenic crops. The adoption of the precautionary approach in public policies addressing transgenic crops is one alternative to better reflect public concerns.



Footnotes

a An earlier version of this paper was presented at a Conference on Agro-industrialization, Globalization and Economic Development, 6–7 August, 1999, American Agricultural Economics Association Meetings, Nashville, Tennessee.