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Mandatory versus voluntary GMO labelling: Does it matter? Yes.

Published on 17 February 2022 by NEOMA

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Genetically modified (GM) foods are widespread worldwide, but they are also controversial and subject to regulatory oversight. In GMO labeling and Consumer Choice, published in the Journal of Marketing, Youngju Kim, professor at NEOMA and her co-authors examine how the GMO labeling that policymakers implement affects consumer choice.

Across four studies, Youngju Kim (NEOMA Business School, France), SunAh Kim (Concordia University, Canada), and Neeraj Arora (University of Wisconsin-Madison, USA) found out that:

“GMO labels create vertical differentiation for many consumers by signaling that non-GM products are better than GM products.

GMO labels draw attention away from factors such as price—making it less important—and allow firms to charge a premium for non-GM products.

Accordingly, consumers show higher willingness-to-pay for non-GM products when a GMO label is present.

Even a voluntary GMO labeling policy deserves regulatory scrutiny because it causes a decrease in demand for GM products.

A mandatory GMO labeling policy shrinks the demand for GM products even more.

The signal contained in the GMO logo (e.g., color) also plays a critical role in consumers’ perceptions of GM products.”

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Professor

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KIM Youngju

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