GMO and non-GMO Labeling Effects: Evidence from a Quasi-Natural Experiment

Marketing Science 0(0). https://doi.org/10.1287/mksc.2022.1375

Forthcoming

52 Pages Posted: 18 Feb 2021 Last revised: 7 Nov 2022

See all articles by Aaron Adalja

Aaron Adalja

Cornell University; Cornell SC Johnson College of Business

Jura Liaukonyte

Cornell University

Emily Yucai Wang

University of Massachusetts, Amherst

Xinrong Zhu

Imperial College Business School

Date Written: March 4, 2022

Abstract

The United States recently mandated disclosure labels on all foods that contain genetically modified organisms (GMOs), despite longstanding, widespread use of voluntary third-party non-GMO labeling. We leverage the earlier passage and implementation of a mandatory GMO labeling law in Vermont as a quasi-natural experiment to show that adding this mandatory labeling into a market with pre-existing voluntary non-GMO labels had no effect on demand. Instead, the legislative process made consumers aware of GMO topics and increased non-GMO product sales, before the GMO labeling mandate went into effect. The GMO-related legislative processes also increased non-GMO product demand in other states that considered, but did not implement, GMO labeling mandates. We find that 36% of new non-GMO product adoption can be explained by differences in consumer awareness tied to legislative activity. Our findings suggest that voluntary non-GMO labels may have provided an efficient disclosure mechanism without mandatory GMO labels.

Keywords: GMO Labeling, Difference-in-Differences, Synthetic Control, Policy Evaluation

Suggested Citation

Adalja, Aaron and Liaukonyte, Jura and Wang, Emily Yucai and Zhu, Xinrong, GMO and non-GMO Labeling Effects: Evidence from a Quasi-Natural Experiment (March 4, 2022). Marketing Science 0(0). https://doi.org/10.1287/mksc.2022.1375, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3774315 or http://dx.doi.org/10.2139/ssrn.3774315

Aaron Adalja

Cornell University ( email )

Ithaca, NY 14853
United States

HOME PAGE: http://https://sha.cornell.edu/faculty-research/faculty/aaa362/

Cornell SC Johnson College of Business ( email )

Ithaca, NY 14850
United States

Jura Liaukonyte (Contact Author)

Cornell University ( email )

347 Warren Hall
Ithaca, NY 14853
United States

Emily Yucai Wang

University of Massachusetts, Amherst ( email )

80 Campus Center Way
University of Massachusetts, Amherst
Amherst, MA 01003
United States
4135455741 (Phone)

Xinrong Zhu

Imperial College Business School ( email )

South Kensington Campus
Exhibition Road
London SW7 2AZ, SW7 2AZ
United Kingdom
07778963203 (Phone)

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