May 18, 2004

Study shows marketability of genetically modified food

Wallace E. Huffman, the C.F. Curtiss Distinguished Professor of Agriculture and Economics at Iowa State University, presented a recent experiment on the marketability of genetically modified foods to students as part of the "Big Problems" Curriculum series.

Hosted by the New Collegiate Division, the lecture, "The Effects of Prior Beliefs and Learning on Consumers' Acceptance of Genetically Modified Foods," focused on Huffman's experiment to see how informed the general public was about genetically modified foods, particularly agricultural products such as modified potatoes, grains, and corn.

Huffman described the factors which affect consumers' acceptance of genetically modified foods as they are being introduced to more of the American market. In the experiment, Huffman and his colleagues took a random sample of people in various cities and rated each test subject on their prior knowledge of genetically modified foods.

About 41 percent of the subjects said they had some opinion on genetically modified foods, while 59 percent said they did not have any opinion. The scientists gave their test subjects $40 and then told the test subjects to bid money on genetically modified and non-genetically modified food products.

Huffman went into depth about an added variable in the experiment, that the genetically modified food could have had three types of labels. Each label gave viable information about the product, but reported on either environmental information, on agricultural-biotechnical information, or on regular consumer information.

The test subjects then submitted their bids from highest to lowest. The design of the auction structure allowed each test subject to win at most one unit of each of the three products. All bids on experimental food items were revealed at the end of the experiment.

The results showed that the average subject bid more for non-genetically modified foods than genetically modified foods, meaning that the average subject thought the non-genetically modified commodity was the better product. The labels also had an influence, as the average subject also picked the genetically modified foods with regular labels.

"If in the consumer's eyes, the genetically modified commodity is substantially equivalent to non-genetically modified commodity, then there would be no need for labeling," Huffman said. "Participants who had subjective prior beliefs behaved as if they were informed and were less responsive to new information."

Huffman said that those with informed prior beliefs behaved as if they placed more trust in third-party information. "Participants with uninformed beliefs prior to the experiment exhibited more variation in bidding under varying circumstances than that for the informed," he explained. "Clearly food labels and information have been shown to affect consumers' bidding, which can be translated to consumer willingness to pay for GM foods."