Farzad Taheripour, Harry Mahaffey, and Wallace E. Tyner
The main objective of this study was to evaluate potential economic and environmental consequences of losing GMO traits in the United States for the major crops of corn, soybeans, and cotton. The first step was to obtain from the literature a range of estimates of the yield losses if we move away from GMO traits in the United States. The second step was to calculate the weighted average GMO and non-GMO area to get the overall shock value. The third step was to introduce the yield losses obtained into a well-known CGE model, GTAP-BIO, to quantify the land use and economic impacts of banning GMO traits in the United States. Absent the GMO technology, more land would be needed to produce corn, soybeans, and cotton. That land comes from switching from other crops and conversion of cropland pasture, pasture, and forest in many global areas. The land expansion likely is similar to the entire US ethanol program. Furthermore, induced land-use emissions were significantly larger than the corresponding figure for US corn ethanol. We evaluated three cases representing different levels of yield shocks. The price changes for corn were as high as 28% and for soybeans as high as 22%. In general, the price increases for two of the three cases were higher than those observed previously for the US ethanol mandate shocks. Food cost changes in the United States amount to $14-$24 billion per year. As expected, welfare falls both in the United States and globally.
Key words: GMO crops, productivity, computable general equilibrium, economic impacts, land use, land use emissions.