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11 things to know about GMOs

Over the past year, I'd received a large number of inquiries about GMOs.  Some of the questions were from moms, others from farmers, and sometimes from the media.  It seems a common set of questions continued to come up, so I got together with my colleagues Eric and Cheryl Devuyst to put to together this University Fact Sheet to provide some succinct answers.

We answer the following 11 questions as best we can in a mere two pages.

  • What is a GMO?
  • Why are crops genetically modified?
  • Are GMOs safe to eat?
  • What crops in the U.S. are genetically modified?
  • What are the environmental effects of GMOs?
  • Do farmers need to use more pesticides with GMOs?
  • How are GMOs regulated?
  • Are GMOs banned in Europe?
  • Should food companies be required to label foods with GMOs?
  • What are the economic effects of farmers using GMOs?
  • What are the potential downsides of GMOs?

You can find our answers here.

How Fat Taxes Affect the Rich and the Poor

I'm pleased that the Economic Journal has decided to publish the paper Distributional Impacts of Fat Taxes and Thin Subsidies I wrote with  Laurent Muller, Anne Lacroix, and Bernard Ruffieux of the University of Grenoble and the French National Institute for Agricultural Research.  

Here is an excerpt

“How do the price policies differentially affect women at different points in the income distribution? Beliefs about the relative effects of fat taxes and thin subsidies on the poor relative to the non-poor are often premised on two assumptions. First is the assumption that the poor consume less healthful diets than the non-poor, perhaps due to the higher costs of more healthy diets (e.g., Drewnowski and Specter, 2004). The second assumption is that price policies are more likely to benefit low income consumers because low income consumers have more room for improvement, and because of their financial situation, they are likely to be more responsive to price changes. In short, a common view is that price policies can help the poor “catch up” to the non-poor in terms of the healthfulness of their diets.

Our experimental results confirm the first assumption: poor women tended to purchase less healthy food than the non-poor women. The implication is that, holding initial consumption patterns constant, policies which tax unhealthy food and subsidise healthy food will be regressive, favouring the non-poor more than the poor. But, people can change consumption patterns in response to price policies. If the poor are more responsive to price policies than are the non-poor, then inequalities will be dampened. This hypothesis, however, was rejected. Behavioural adjustments to the price policies amplified rather than dampened the divergent fiscal impacts of the price policies.”

In short:

“The tax/subsidy policies serve to widen the gap between the poor and non-poor, increasing the inequality in health and fiscal outcomes. Fat taxes cause the poor to pay disproportionally more for food than the non-poor and thin subsidies primarily flow to the non-poor. These effects occur because the non-poor already consume healthier diets but also because the non-poor are more price responsive than the poor”

Our approach to addressing this issue is quite different than that of previous studies.  Here's what's unique about our appoarch

“The advantage of the experimental set-up is that people’s choice behaviours are directly observed (rather than inferred as in a simulation study). In addition, the setting does not require the use of econometric models to infer behavioural responses. There is no need to assume a functional form or structure for responses; each individual can respond in their own unique way according to their own preferences. The experiment attempts to measure the overall fiscal effect (based on a day’s food choices) rather than simply focusing on one or two foods or a few food product categories. The experiment environment also allows us to study larger price variations (+/- 30%) than would likely have been feasible outside the lab, and as such, makes the price changes particularly salient.”

Here is one of the key figures from the paper.  The figure shows the distribution of price indices (i.e., the relative change in prices paid) after the introduction of a combined unhealthy-food-tax and healthy-food-subsidy policy for low income women as compared to a reference group (i.e, "normal" income women).

The Laspeyres index calculates the change in prices paid relative to the initial pattern of consumption; the Paasche index is similar except that it weights prices paid using the new pattern of consumption.  A greater difference between the two indices reveals greater substitution and responsiveness to the policy.

The figure above shows that 25-30% of  the low income consumers paid more for food after the price policy (they had an index greater than 100), and given the similarity of the two red lines, were less responsive (perhaps because of being more habit prone) than the richer consumers.  Moreover, at the individual level, the Paasche index was higher than the Laspeyres index for 35.9% of low income individuals.  These individuals did not shift their diet in the intended direction.

We ended the paper as follows:

“Whatever health benefits these policies might create, this paper suggests they need to be weighed against the adverse monetary effects they have on some of the poorest people in society.”

Food, farm, and kitchen innovations

 A few links I've come across recently on food, farm, and kitchen innovations:

Immigration and agriculture

Diana Prichard, who runs the Righteous Bacon blog, alerted me to a project she's working on to create a documentary highlighting the important relationship between immigration and agriculture. 

“Immigration Feeds America

77% of farmworkers in the U.S. are immigrants. Loss of even half of foreign born dairy workers alone would result in an estimated 33% increase in milk prices—and immigrants are not only working in dairy. They grow our nation’s fruit and vegetables; raise our poultry, pork, beef and lamb; shepherd flocks of sheep that produce our wool; and produce the trees, shrubs and flowers that grace our front lawns.

But you won’t hear about these contributions on the campaign trail, and most media portrays them as helpless and voiceless. Farmworker, a debut documentary and companion publication by award-winning journalist Diana Prichard is working to change that—but we need your help. ”

Learn more and donate here.

Farmers markets and food safety

Last spring, I noted that Marc Bellemare from he University of Minnesota gave a provocative seminar in our department on the relationship between farmers markets and foodborne illness.  This weekend, the Marc discuss the research in a piece for the New York Times. 

Here is the main finding:

“As we will report in an updated version of an unpublished working paper released last summer, we found correlations that, in statistical parlance, are too robust to ignore. First, we found a positive correlation between the number of farmers markets per capita in a given state and in a given year and the number of reported outbreaks, regardless of type, of food-borne illness per capita in that state that year. Then, we found a similar positive correlation between farmers markets per capita and reported individual cases of food-borne illness per capita.”

And,

“And even if our results did identify a causal relationship between farmers markets and food-borne illness, it would not be possible to identify the precise mechanisms through which this happens, and it would be a critical mistake to conclude that the foods sold at farmers markets are themselves to blame. That is because most cases of illness are caused by consumers who undercook or fail to wash their food. Indeed, our results may suggest that many people erroneously believe that food bought at farmers markets needn’t be washed because it is “natural.””