On Butterflies and Frankenstein: A Dynamic Theory of Regulation

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. www.econstor.eu Terms of use: Documents in EconStor may AbstractThere are major differences in regulation among various countries. A particular case is the difference between the EU and US in regulating biotechnology. We develop a formal and dynamic model of government decision-making on regulation. We show that minor differences in consumer preferences can lead to important and persistent regulatory differences, and that temporary shocks to preferences can have long-lasting effects. This hysteresis in regulatory differences is shown to be caused by producer protectionist motives. We argue that this model may contribute to explain the difference between EU and US biotechnology regulation.

Trade and the Political Economy of Food Standards

“…Costinot (2008) compares the performance of the WTO’s national treatment principle and the EU’s mutual recognition principle with respect to product standards. An example of how strategic cross‐country interactions can be integrated in our political economy framework is Swinnen and Vandemoortele’s (2011) dynamic model of standard setting. In our analysis, we do not consider strategic interactions in standard‐setting between governments of different countries or harmonisation of standards across countries.…”

The EU legislation on “GMOs” between nonsense and protectionism: An ongoing Schumpeterian chain of public choices

“…Hysteresis -a persistent effect of a temporary stimulus -is a concept that, as applied to political-economic and social dynamics, in our case strongly contributes to explaining the inertia of the continuing "anti-GMO" attitude in the EU (Swinnen and Vandemoortele, 2011). …”

“…(Allen, 2009) To satisfy the "anti-GMO" brigade, which is very lively in Brussels and in many EU nations; for some conservative anti-biotech groups, though, continuing activity can be envisaged, since the relentless "opposition to GE and support for stiff regulation against it is financially rewarding" (Zilberman, Graff, Hochman and Kaplan, 2015, 218). To adapt policy to the preferences of consumers (Swinnen and Vandemoortele, 2011), who are suspicious of "GMOs" due to an inflated perception of their supposed risks. Last but not least, to protect the interests of the traditional herbicide/pesticide chemical industry: "European governments may be less supportive of the technology as long as it results in reduced exports of pesticides."…”