Ex-Ante Regulation and Ex-Post Liability under Uncertainty and Irreversibility: Governing the Coexistence of GM Crops

Volker Beckmann, Claudio Soregaroli, Justus Wesseler
2010 Economics : the Open-Access, Open-Assessment e-Journal  
Ex-ante regulations and ex-post liabilities for using a new technology will induce additional costs for adopters. The standard model is advanced by including irreversibility and uncertainty and taking into account transaction costs of negotiating possible cost reductions. The case analysed is the coexistence policy for GM crops in the European Union. Results show, the design of the rules and regulations can provide strong incentives for regional agglomeration of GM and non-GM farmers. JEL D81,
more » ... farmers. JEL D81, L23, Q12, Q24, R3
doi:10.5018/economics-ejournal.ja.2010-9 fatcat:3kypbnhkmjdcxjfh5dlmul5pge