The Political Economy of Regulation of Biotechnology in Agriculture

In Europe and in many developing countries, genetically modified (GM) crops are effectively banned. Some countries limit the direct use of such crops as food for human consumption to a few niche agricultural products, such as papaya, sweet corn, and squash. These restrictions can be traced to public decision-making processes reflecting the interplay of sometimes conflicting economic interests of different groups within society. This chapter examines the political economy underlying the regulation of biotechnology in agriculture. It begins with a review of the literature on the politics and political economy of agricultural biotechnology policies, followed by a discussion of how political choices regarding GM crops have evolved over time. It then considers the agricultural economics literature regarding the distributional impacts of the adoption of GM crops, focusing on the impact of the introduction of GM crop varieties on the economic welfare of different groups in society. It also assesses the formation and evolution of agricultural biotechnology policies in Europe and their effects on salient interest groups such as consumers, farmers, environmental interest groups, and industrial sectors.